THL_JanFeb_2012

Recent Developments in Employment Law Cyber-Insubordination Mexican Labor and Employment Law Expanding the Coming and Going Rule Immigration-Related Worksite Enforcement Actions Significant SCOTUS Employment Law Opinions 62nd Harvest Party

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THE HOUSTON

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Volume 49 – Number 4

January/February 2012

Labor and Employment Law

The U.S. Supreme Court hears Wal-Mart Stores, Inc. v. Dukes

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contents Volume 49 Number 4

January/February 2012

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16

FEATURES Developments 10 Recent and Regulatory Trends in Employment Law

By Michelle Hoogendam Cash and Sidd Rao

16 Cyber-Insubordination: How an Old Labor Law

Protects New Online Conduct

By Samantha Barlow Martinez

Get What?

20 Employees What Texas Employers Need

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to Know About Mexican Labor and Employment Law

By Yasser Madriz, Felicity Fowler and Meghaan McElroy

the Coming 26 Expanding and Going Rule: One Officer’s Struggle

By Benny Agosto JR. and Chelsie King Garza

32 Immigration-Related Worksite Enforcement

Actions: I-9s & Beyond

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40

By Joy E. Sanders

Schnapper Trio 36 The Significant Employment Opinions from the U.S. Supreme Court

By Paul Harris

Harvest Party Raises 40 62nd Record $561,000 for Houston

The Houston Lawyer

Bar Foundation

The Houston Lawyer (ISSN 0439-660X, U.S.P.S 008-175) is published bimonthly by The Houston Bar Association, 1300 First City Tower, 1001 Fannin St., Houston, TX 77002-6715.

Periodical postage paid at Houston, Texas. Subscription rate: $12 for members. $25.00 non-members. POSTMASTER: Send address changes to: The Houston Lawyer, 1300 First City Tower, 1001 Fannin, Houston, TX 77002. Telephone: 713-759-1133. All editorial inquiries should be addressed to The Houston Lawyer at the above address. All advertising inquiries should be addressed to: Quantum/SUR, 12818 Willow Centre Dr., Ste. B, Houston, TX 77066, 281-955-2449 ext 16, www.thehoustonlawyer.com, e-mail: leo@quantumsur.com Views expressed in The Houston Lawyer are those of the authors and do not necessarily reflect the views of the editors or the Houston Bar Association. Publishing of an advertisement does not imply endorsement of any product or service offered. ŠThe Houston Bar Association, 2012. All rights reserved.

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January/February 2012

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Join the Houston Bar Association’s 100 Club The Houston Bar Association 100 Club is a special category of membership that indicates a commitment to the advancement of the legal profession and the betterment of the community. The following law firms, corporate legal departments, law schools and government agencies with five or more attorneys have become members of the 100 Club by enrolling 100 percent of their attorneys as members of the HBA. Firms of 5-24 Attorneys AAbraham, Watkins, Nichols, Sorrels, Agosto & Friend Abrams Scott & Bickley, L.L.P. Adair & Myers PLLC Ahmad, Zavitsanos & Anaipakos, P.C. Ajamie LLP Allen Boone Humphries Robinson LLP Andrews Myers, P.C. Bair Hilty, P.C. Baker Williams & Matthiesen LLP The Bale Law Firm, PLLC Barker Lyman, P.C. Barrett Daffin Frappier Turner & Engel, LLP Bateman/Pugh, PLLC Bell, Ryniker & Letourneau, P.C. Berg & Androphy Bingham, Mann, House & Gibson Brown McCarroll L.L.P. Buck Keenan LLP Burck, Lapidus, Jackson & Chase, P.C. Bush & Ramirez, L.L.C. Butler I Hailey Caddell & Chapman Cage Hill & Niehaus, L.L.P. Campbell Harrison & Dagley L.L.P. Campbell & Riggs, P.C. Chernosky Smith Ressling & Smith PLLC Christian Smith & Jewell, L.L.P. Cokinos Bosien & Young Conley Rose P.C. Connelly • Baker • Wotring LLP Cooper & Scully, P.C. Cozen O’Connor Crady, Jewett & McCulley, LLP Currin, Wuest, Mielke, Paul & Knapp, PLLC David Black & Associates De Lange Hudspeth McConnell & Tibbets LLP Devlin Naylor & Turbyfill PLLC Diamond McCarthy LLP Dinkins Kelly Lenox Lamb & Walker, L.L.P. Dobrowski, Larkin & Johnson LLP Dow Golub Remels & Beverly, LLP Doyle Restrepo Harvin & Robbins, L.L.P. Drucker, Rutledge & Smith, L.L.P. Ebanks Taylor Horne L.L.P. Edison, McDowell & Hetherington LLP Ellis, Carstarphen, Dougherty & Griggs P.C. Ewing & Jones, PLLC Farnsworth & Von Berg, L.L.P. Fibich Hampton & Leebron, L.L.P. Fisher, Boyd, Brown & Huguenard, LLP Fizer Beck Webster Bentley & Scroggins, P.C. Fleming & Associates L.L.P. Foreman DeGeurin & Nugent Frank, Elmore, Lievens, Chesney & Turet, L.L.P. Fullenweider Wilhite PC Funderburk & Funderburk, L.L.P. Galloway Johnson Tompkins Burr & Smith Germer Gertz, L.L.P. Givens & Johnston PLLC Goldstein, Faucett & Prebeg, L.L.P. Gordon & Rees LLP Greer, Herz & Adams, L.L.P.

Hagans Burdine Montgomery & Rustay, P.C. Harberg, Huvard, Jacobs & Wadler, LLP Harris, Hilburn & Sherer Harrison, Bettis, Staff, McFarland & Weems, L.L.P. Hays McConn Rice & Pickering, P.C. Heard, Robins, Cloud & Black, L.L.P. Heim, Payne & Chorush, L.L.P. Hicks Thomas LLP Hirsch & Westheimer, P.C. Hogan Lovells US LLP Holm I Bambace LLP The Hudgins Law Firm Hunton & Williams LLP Jackson Gilmour & Dobbs, PC Jackson Lewis LLP Jenkins Kamin, L.L.P. Johnson, DeLuca, Kennedy & Kurisky, P.C. Johnson Radcliffe Petrov & Bobbitt PLLC Johnson, Trent, West & Taylor, L.L.P. Jones, Walker, Waechter, Piotvent, Carrere & Denegree, L.L.P. Joyce, McFarland + McFarland LLP Kane Russell Coleman & Logan PC Kasowitz Benson Torres & Friedman LLP Kelly Hart & Hallman, LLP Kelly, Sutter & Kendrick, P.C. Kroger Frisby LeBlanc Bland P.L.L.C. Legge Farrow Kimmitt McGrath & Brown, L.L.P. Linebarger Goggan Blair & Sampson LLP Liskow & Lewis Lorance & Thompson, PC MacIntyre & McCulloch, LLP Manning, Gosda & Arredondo, L.L.P. McGinnis Lochridge & Kilgore LLP McLeod Alexander Powel & Apffel PC MehaffyWeber PC Miller Scamardi & Carraba Mills Shirley L.L.P. Morris Lendais Hollrah & Snowden Munsch Hardt Kopf & Harr, P.C. Murray | Lobb PLLC Myers, Dale & Associates Nathan Sommers Jacobs Nickens Keeton Lawless Farrell & Flack LLP Ogden, Gibson, Broocks, Longoria & Hall, LLP Ogletree, Deakins, Nash, Smoak & Stewart, P.C. Okin Adams & Kilmer LLP Osha Liang LLP Pagel Davis & Hill PC Perdue Brandon Fielder Collins & Mott Perdue & Kidd, L.L.P. Phelps Dunbar LLP Phillips & Akers, P.C. Pillsbury Winthrop Shaw Pittman LLP Ramey, Chandler, McKinley & Zito Ramsey & Murray PC Roach & Newton, L.L.P. Roberts Markel P.C. Ross, Banks, May, Cron & Cavin, P.C. Royston, Rayzor, Vickery & Williams, L.L.P. Rusty Hardin & Associates, P.C. Rymer, Moore, Jackson & Echols, P.C. Schiffer Odom Hicks & Johnson PLLC

Schirrmeister Diaz-Arrastia Brem LLP Schwartz, Junell, Greenberg & Oathout, LLP Schwartz, Page & Harding L.L.P. Seyfarth Shaw LLP Shannon Martin Finkelstein & Alvarado, P.C. Shepherd, Scott, Clawater & Houston, L.L.P. Shipley Snell Montgomery LLP Short Carter Morris, LLP Singleton Cooksey LLP Slusser Wilson & Partridge LLP Smith & Carr, P.C. Smith Murdaugh Little & Bonham, L.L.P. Smyser Kaplan & Veselka, L.L.P. The Spencer Law Firm Sprott, Rigby, Newsom, Robbins & Lunceford, P.C. Steele Sturm P.L.L.C. Stevenson & Murray Strong Pipkin Bissell & Ledyard, L.L.P. Sutherland Asbill and Brennan LLP Tekell, Book, Allen & Morris, L.L.P. Thompson & Horton LLP Thompson, Coe, Cousins & Irons, LLP Tucker, Taunton, Snyder & Slade, P.C. Ware, Jackson, Lee & Chambers, L.L.P. Watt Beckworth Thompson & Henneman, LLP Westmoreland Hall Maines & Lugrin PC Weycer Kaplan Pulaski & Zuber, P.C. White Mackillop & Gallant P.C. Williams, Birnberg & Andersen, L.L.P. Williams Kherkher Hart Boundas LLP Williams Morgan & Amerson, P.C. Willingham, Fultz & Cougill, LLP Wilson, Cribbs & Goren, P.C. Wilson, Elser, Moskowitz, Edelman & Dicker Wong, Cabello, Lutsch, Rutherford & Brucculeri, P.C. Wright Brown & Close, L.L.P. Yetter Coleman LLP Ytterberg | Deery LLP Zimmerman, Axelrad, Meyer, Stern & Wise, P.C. Zukowski, Bresenhan & Sinex, L.L.P. Firms of 25-49 Attorneys Adams & Reese LLP Baker & McKenzie LLP Beck Redden & Secrest, L.L.P. Gibbs & Bruns LLP Greenberg Traurig, LLP Hoover Slovacek LLP Howrey LLP Hughes Watters Askanase LLP Jones Day Littler Mendelson, PC Looper Reed & McGraw, P.C. Morgan, Lewis & Bockius LLP Olson & Olson LLP Susman Godfrey LLP Firms of 50-100 Attorneys Akin Gump Strauss Hauer & Feld LLP Baker Hostetler LLP Beirne, Maynard & Parsons, L.L.P. Chamberlain Hrdlicka White Williams & Martin

Coats I Rose Gardere Wynne Sewell LLP Jackson Walker L.L.P. King & Spalding LLP Martin, Disiere, Jefferson & Wisdom, L.L.P. Porter & Hedges LLP Thompson & Knight LLP Winstead PC Firms of 100+ Attorneys Andrews Kurth LLP Baker Botts L.L.P. Bracewell & Giuliani LLP Fulbright & Jaworski L.L.P. Haynes and Boone LLP Locke Lord Bissell & Liddell LLP Vinson & Elkins LLP Corporate Legal Departments AT&T Texas BP CenterPoint Energy El Paso Corporation Kellogg Brown & Root Inc Lyondell Petrochemical Company MAXXAM Inc Newfield Exploration Company Petrobras America Inc. Plains Exploration & Production Co. Pride International Inc. Rice University Sysco Corporation Texas Children’s Hospital Total E&P USA Inc. University of Houston System Law School Faculty South Texas College of Law Thurgood Marshall School of Law University of Houston Law Center Government Agencies City of Houston Legal Department Harris County Attorney’s Office Harris County District Attorney’s Office Harris County Domestic Relations Office Metropolitan Transit Authority of Harris County Texas Port of Houston Authority of Harris County Texas

contents Volume 49 Number 4

January/February 2012

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departments Message 6 President’s A Family Day of Service

By Denise Scofield the Editor 8 From The Wide World of Labor

and Employment

By Tamara Stiner Toomer Spotlight 42 Committee One Good IDEA Reaches

Thousands of Students Across Houston

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41

By Polly Graham Profile in Professionalism 43 ABenny Agosto, Jr. Partner, Abraham, Watkins, Nichols, Sorrels, Agosto & Friend National President, Hispanic National Bar Association the Record 44 OffThomas A. Hagemann:

The Playwright’s Solution

By Julie Barry

Reviews 45 Media Documentary: Hot Coffee Reviewed by Angela L. Dixon

Movie: Puncture Reviewed by Sammy Ford IV

The Houston Lawyer

47 Placement Service 48 Litigation MarketPlace

Cover: Drawing by Art Lien See more of his work at www.courtartist.com 4

January/February 2012

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president’s message

By Denise Scofield Morgan, Lewis & Bockius LLP

A Family Day of Service

The Houston Lawyer

W

hen my oldest daughter entered elementary school in the late 1990s, the concept of “character education” was sweeping through the country.

At schools with sufficient funding, new positions for character education administrators emerged and a discussion of “core values” (kindness, respect, responsibility and honesty) permeated the non-academic curriculum. Over the past decade, the concept of “service learning” has supplemented (and in some schools supplanted) those character education programs. Many schools now appoint parents to run community service programs or assign the task to administrators, expecting students to fulfill targets or meet requirements. Service learning provides meaningful and tangible opportunities for young students to put core values into practice.

Studies show that children who engage in community service and philanthropic behavior are more likely to continue those activities into their adult lives.

Those children also are more likely to display concern for their communities, and they exhibit more sophisticated critical thinking skills. When a parent volunteers with the child, the results are even more dramatic. In Susan Crites Price’s The Giving Family: Raising Our Children to Help Others, she identifies tips for parents to instill service behavior in their children: 1. Be a role model. Volunteer and donate.

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January/February 2012

to spend a Saturday morning volunteer2. Show kids the way. Take them with ing with their families. you to volunteer and talk to them Children from toddlers to teenagers are about your volunteer activities. encouraged to join 3. Make giving a “Studies show that us as we participate year-round habit, in age-appropriate not just the colchildren who engage activities designed lection of toys or in community service to serve others in ten food at the holilocations throughdays. and philanthropic behavior out the city. As I 4. Start now. The are more likely to noted last summer, earlier you teach some of the projects the habit of sercontinue those activities we perform together vice, the easier it into their adult lives. will be familiar to will be to sustain. us—sorting clothes Those children also 5. Expect your chilfor the Campaign dren to serve and are more likely to for the Homeless, give. display concern for freshening up our 6. Let your children community at the decide the projtheir communities, and Trash Bash, or conects in which they they exhibit more structing a home for have an interest. a deserving Hous7. Teach your chilsophisticated critical tonian at our Habidren to manthinking skills.” tat for Humanity age and donate build—others will money they have be new—visiting with a veteran at the earned.

Museum of Natural Science, participat8. Praise your children for their philaning in a soccer clinic with underprivithropic service and donations. leged youth, or making sandwiches for

a needy child’s lunch. A complete list At the HBA, opportunities to volunteer of projects and locations where you can with your children are abundant yearwork side-by-side with your children will round. Whether you and your child are be included in the March-April issue of interested in serving the needs of the inthe Houston Bar Bulletin. digent, the abused, the elderly, the veterBy volunteering with your kids, not ans who have served our country, or the only will you have an enjoyable morning environment, there is a project for you. with your family, but you will leave a lastMany of those activities will be highlighting impression on your children while ed on April 21, 2012 when the HBA will helping others. afford our members with an opportunity

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10 Ways the HBA serves you.

• Meet your MCLE requirements through 80+ hours of FREE CLE and 120+ hours of discounted online CLE programming each year • Support your profession and community • Professional networking opportunities.

• Get to know the local judiciary • Pro Bono opportunities • Stay current on legal issues, educational programs and events through HBA publications • Learn to lead through committee participation • Gain the right tools for your practice through Section membership • Opportunities to participate in over 35 community programs • Partnership discounts at local venues and vendors

www.hba.org

Enhance your practice Try the HBA advantage. thehoustonlawyer.com

January/February 2012

7

from the editor

By Tamara Stiner Toomer McGuireWoods LLP

Associate Editors

Julie Barry Attorney at Law

Keri Brown Baker Botts L.L.P.

Angela L. Dixon Attorney at Law

The Houston Lawyer

Robert W. Painter Painter Law Firm PLLC

Don Rogers Harris County District Attorney’s Office

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I

The Wide World of Labor and Employment

n the past year, there have been several notable matters in the labor and employment arena. Most of us are aware of the gender discrimination class action lawsuit filed against Wal-Mart on behalf of as many as 1.5 million women employees for back pay and punitive damages. Although the U.S. Supreme Court dismissed the class action in June 2011, the litigation is not necessarily over. This is because the Court’s decision only addressed whether a national class action could go forward and does not preclude individual lawsuits against Wal-Mart or smaller, more concentrated class actions. In fact, two new class action lawsuits were filed in Texas and California by lawyers representing female workers who allege they were discriminated against, and more regional lawsuits are expected.

Other labor and employment matters that made headlines in the last year involved the labor disputes besieging professional sports. Unless you have been living under a rock—literally—you heard about the clashes between the players and owners of the NFL and NBA that almost foiled their respective 2011-2012 seasons. At the heart of both leagues’ labor problems was how to split billions of dollars in revenues and how to fashion new rules governing player contracts and free agency. While most of us will never be involved in such disputes (my football playing days are over), it shows that labor laws play an important role in many areas, including sports.

For any firm or company that hires unpaid interns, the most recent labor and employment litigation should raise some level of concern. A former intern of Harper’s Bazaar seeks class action status for her suit

January/February 2012

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against the magazine’s publisher for unpaid work that she performed from August to December, 2011. According to the intern’s complaint, she typically worked at least 40 hours per week, and sometimes as much as 55 hours, without pay; and, therefore, she must be treated like any other employee under the federal Fair Labor Standards Act. This case raises the issue of whether employers could be violating the law by hiring unpaid interns to do work that ordinarily would be performed by a paid employee.

There are many facets and intricacies of labor and employment law. While we cannot touch upon them all in this issue of THL, the six articles included in this edition cover a lot of ground. Topics range from worksite enforcement of immigration laws to worker’s compensation issues facing “off-duty” police officers.

You can also read about Professor Eric Schnapper’s 2011 trifecta with the U.S. Supreme Court, important aspects of Mexican labor and employment law, and recent developments and trends in U.S. employment law. And for those of you who have “a friend” that posts unfavorable statements about his/her boss on social media, there is also an article for that “friend” in this issue.

Many thanks to Jill Yaziji, Joy Sanders, and Judy Ney for putting in overtime to bring our readers this current issue of THL focusing on Labor and Employment Law. I also want to thank Farrah Martinez, who I neglected to acknowledge in my last column, for serving as guest editor of the past Professionalism and Ethics issue and for her hard work in helping to churn out another great edition of THL. That’s it for now. I hope you enjoy reading this issue. Until next time...

BOARD OF DIRECTORS President

Secretary

Denise Scofield

Alistair B. Dawson

President-Elect

Treasurer

Brent Benoit

David A. Chaumette

First Vice President

Past President

Laura Gibson

T. Mark Kelly

Second Vice President

M. Carter Crow

DIRECTORS (2010-2012)

Benny Agosto, Jr. Warren W. Harris

Todd M. Frankfort John Spiller

Hon. David O. Fraga Neil D. Kelly

DIRECTORS (2011-2013) Jennifer Hasley Daniella D. Landers

editorial staff Editor in Chief

Tamara Stiner Toomer Associate Editors

Julie Barry Angela L. Dixon Don Rogers

Keri D. Brown Robert W. Painter

Sharon D. Cammack Don D. Ford III Sammy Ford IV Polly Graham John S. Gray Al Harrison Farrah Martinez Judy L. Ney Edward J. (Nick) Nicholas Caroline C. Pace Benjamin K. Sanchez Joy E. Sanders Hannah Sibiski Gary A. Wiener N. Jill Yaziji

Editorial Board

Managing Editor

Tara Shockley

HBA office staff Membership and Technology Services Director

Executive Director

Kay Sim

Ronald Riojas

Administrative Assistant

Ashley G. Steininger

Membership Assistant

Ariana Ochoa

Administrative Assistant

Bonnie Simmons

Committees & Events Director

Receptionist/Resource Secretary

Claire Nelson

Lucia Valdez

Committees & Events Assistant

Director of Education

Lucy Fisher

Brian Edwards

Continuing Legal Education Assistant

Communications Director

Tara Shockley

Amelia Burt Community Education Assistant

Communications/ Web Designer

Natasha Williams

Brooke Eshleman

Advertising sales Design & production QUANTUM/SUR

12818 Willow Centre, Ste. B, Houston, TX 77066 281.955.2449 • www.quantumsur.com Publisher

Leonel E. Mejía Production Manager

Marta M. Mejía Advertising

Mary Chavoustie

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January/February 2012

9

Recent Developments and Regulatory Trends in Employment Law

By Michelle Hoogendam Cash and Sidd Rao

E

mployment law has seen significant activity recently.

Regulators have been busy interpreting new and old legislation, and creative lawyers have been pursuing new avenues for litigation and discovery as technology and the workforce evolve. In the past two years, the United States Department of Labor (DOL) and the Equal Employment Opportunity Commission (EEOC) have been active in rulemaking, pursuing litigation, and issuing new regulations that will have a significant impact on the employment arena for years to come.

“There’s an App for That”–Timekeeping Made Easier for Workers The DOL recently launched its first application (“App”) for smartphones—a time sheet program that allows employees to track the hours they work and therefore determine whether they are owed any regular or overtime wages. The App is free and allows employees to keep their own records instead of relying on those maintained by their employers.1 The express purpose of this App is to help employees who believe they are either (1) improperly classified as “exempt” from the overtime requirements, or (2) not being paid for all of the hours that they have worked. The App allows them to keep a separate “shadow” record to support a later claim for unpaid wages.

Users of the App can record regular work hours, break time, and any overtime hours for one or more employers.

The DOL believes this new technology is significant, because for those workers who use the App, the DOL will not have to rely solely on employer records in the context of a Wage and Hour Division investigation.2 Among other things, the App will make it easier for workers to track time away from their employer’s premises, which could be particularly useful for non-exempt employees who wish to

track the time they spend working remotely on a smart phone, such as reading and sending e-mails and performing other work-related tasks. The App allows the employee to activate the electronic timesheet before he starts working on the smart phone, and simply deactivate it when he is finished. With the press of a button, the employee can create a spreadsheet showing the wage calculation for any time period.

This new technology underscores the need for employers to take careful steps to ensure that their record-keeping policies and practices comply with federal and state wage and hour laws. In particular, employers need to ensure that the time employees spend providing services—including time on and off their premises—is included among hours worked. Although employees should be encouraged to report all of the hours they work to their employers, those employers also should be prepared to defend the accuracy of their own records in the event of a dispute with an employee or the DOL over the number of hours worked.

The App currently works with the iPhone and iPod Touch. The DOL has expressed its intent to explore versions for other smartphones, such as Android and BlackBerry, and additional tracking features, such as tips, commissions, bonuses, deductions, holiday pay, weekend pay, shift differentials and rest-day pay.3 Credit Checks Will Increase EEOC Scrutiny Many employers use pre-employment background checks when making hiring decisions. In many instances, these standard background checks include a candidate’s credit history, whether intentional or as part of the “package.” Although the Federal Fair Credit Reporting Act (FCRA) governs the use of such credit checks, no federal law precludes their use, and there is nothing to suggest that “personal credit history” is a protected category under Federal anti-discrimination laws.

The EEOC, however, does not support

the use of pre-employment credit checks as a criterion for considering applicants for hire. The EEOC contends that preemployment credit checks can have an adverse impact on certain demographic groups, such as people of color, women, or people with disabilities. The EEOC recently stated that: [I]nquiry into an applicant’s current or past assets, liabilities, or credit rating, including bankruptcy or garnishment, refusal or cancellation of bonding, car ownership, rental or ownership of a house, length of residence at an address, charge accounts, furniture ownership, or bank accounts generally should be avoided because they tend to impact more adversely on minorities and females. Exceptions exist if the employer can show that such information is essential to the particular job in question.4 In the current economic climate, the EEOC has increased its scrutiny into the practice of using credit checks as a criterion for screening employment applicants. “High unemployment has forced an increasing number of people to enter or re-enter the job market,” said EEOC Chair Jacqueline A. Berrien. “As a result, an ever increasing number of job applicants and workers are being exposed to employment screening tools, such as credit checks, that could unfairly exclude them from job opportunities.”5 Thus, the EEOC is not focusing on whether “personal credit history” is a protected category under the law, but rather on whether an employer’s use of credit checks could support a finding of discrimination in the form of adverse impact.

Even though pre-employment credit checks may be legal when undertaken in accordance with the FCRA and other credit-check laws, the practice is on the EEOC’s radar.6 Consequently, an employer may consider adjusting its practice for obtaining and/or using credit checks as part of its standard background checks to ensure that such use is consistent with the law.

thehoustonlawyer.com thehoustonlawyer.comJanuary/February March/April 2012 2011

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Also on the EEOC’s Radar: Not Hiring the Unemployed “Only will consider candidates currently employed” is a theme that employers are using these days. This practice excludes job applicants from consideration for a position simply because they are unemployed.7 Employers engaging in this practice tend to reason that current employment status offers at least some indication of a candidate’s skills and performance: an employer may think that if a candidate is still employed in this tough job market, she must be a strong performer, or one who is highly valued by her current employer. Some employers have explicitly stated in job postings that unemployed candidates will not be considered.8 This practice is not illegal in Texas or many other states. New Jersey has enacted legislation banning overt discrimination against unemployed candidates in job postings, and several other states have similar bills under consideration, but it remains legal for the most part to refuse to consider the unemployed when

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recruiting.9 Despite the apparent “legality” of refusing to consider an out-of-work applicant for a position, the EEOC has been actively investigating, and discouraging, this practice. The EEOC takes a global look at the practice in light of a potential disparate impact. The EEOC first notes that unemployment rates for African-Americans, Hispanics, and Native Americans are higher than for whites.10 As a result, considering only employed applicants has an unlawful disparate impact against those groups. Secondly, the EEOC observes that discrimination against out-of-work employment candidates can also have an adverse disparate impact on women, particularly those in non-traditional occupations, and on older or disabled individuals, as they represent a relatively larger proportion of the unemployed population than younger, male, or non-disabled people.11 Testifying before the EEOC, William E. Spriggs of the DOL said “there is a strong indication that there is a potential for disparate impact among racial minori-

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ties and among workers with disabilities and among older workers because of higher unemployment rates among these groups.”12 A convergence of opinion from both of these federal regulatory agencies could be a sign of things to come.

Therefore, employers considering restrictions against hiring unemployed candidates may want to reevaluate that practice. Current employment status, on its own, may not be a predictor of performance. In recent years, many good employees have been let go for a variety of reasons that have nothing to do with their work performance. The weak correlation between employment status and work performance may not justify the risk of a disparate impact charge or the potential public relations issues that could result from being labeled as a company that refuses to consider out-of-work applicants.

The EEOC Finds Fault with “No Fault” Absence Policies Employers who adopt “no fault” absence

policies impose discipline on employees who accumulate a certain, designated number of absences, regardless of the reason for the absence. Many Texas employers adopted these “no fault” absence policies in response to concerns that they were retaliating against employees who had extended time away from work for workers’ compensation leave. The “no fault” absence policy took away any claim of intentional retaliation against a person who took workers compensation leave, because all employees who had lengthy absences, regardless of the reason, were treated the same. The complexity of these types of policies has multiplied in light of job-protection obligations under the Family and Medical Leave Act, as well as the EEOC’s view that these types of policies violate the Americans with Disabilities Act. In 2011, the EEOC aggressively addressed claims resulting from these kinds of policies, contending that “no fault” absences violated the Americans with Disabilities Act (ADA) if companies

refuse to make exceptions to its policy to accommodate employees with disabilities. The ADA requires employers to engage in an interactive process to determine the appropriate type of reasonable accommodation that the employer may provide a qualified individual with a disability.13 Under the EEOC’s interpretation, the ADA requires employers to determine whether leave from work would constitute a reasonable accommodation. Accordingly, a strict “no fault” absence policy that is not sensitive to the particular individualized circumstances of a disabled employee can run afoul of federal law.

The EEOC made this point clearly when it filed a nationwide class disability discrimination lawsuit against Verizon Communications.14 The suit, filed against 24 named Verizon subsidiaries, contended that Verizon unlawfully denied reasonable accommodations to hundreds of employees and disciplined and/or fired them pursuant to Verizon’s “no fault” attendance plans.15 Although

Verizon denied the claim, it entered into a settlement and consent decree with the EEOC, under which Verizon would pay $20 million and provide significant equitable relief to resolve the matter.

“This settlement demonstrates the need for employers to have attendance policies which take into account the need for paid or unpaid leave as a reasonable accommodation for employees with disabilities,” said Spencer H. Lewis, Jr., Director of the EEOC’s Philadelphia District Office.16 This case is the largest disability discrimination settlement in a single lawsuit in the history of the EEOC. The EEOC asserted that Verizon failed to provide reasonable accommodations for people with disabilities, such as making an exception to its attendance plans for individuals whose “chargeable absences” were caused by their disabilities. Instead, the company disciplined or terminated employees who needed such accommodations.

In addition to the $20 million in mon-

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etary relief, the three-year decree includes injunctions against engaging in any discrimination or retaliation based on disability and requires the company to revise its attendance plans, policies and ADA policy to include reasonable accommodations for persons with disabilities, including excusing certain absences.17 Verizon will provide mandatory periodic training on the ADA, provide the EEOC with reports about complaints and compliance, and post a notice about the settlement.18 Finally, Verizon will appoint an internal consent decree monitor to ensure its compliance.19

evolution and to pay attention to these dynamic issues as they develop.

Michelle Hoogendam Cash and Sidd Rao practice employment law with the Houston firm of Shellist Lazarz Slobin LLP, where they focus primarily on the representation of individuals. Cash is Board Certified in Labor and Employment Law. Endnotes 1.

2.

3.

4.

Conclusion In this business climate of rapidly evolving technologies and increased regulatory activity, employment law issues continue to evolve at a rapid pace. Company practices that have no wrongful intent can create employment liability, and employees are armed with powerful tools to ensure compliance. Employees and employers alike will need to remain mindful of this

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5.

6.

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The U.S. Department of Labor, Keeping track of wages: The US Labor Department has an app for that! (last modified May 9, 2011), http://www. dol.gov/opa/media/press/whd/WHD20110686. htm.

Id. Id. The U.S. Equal Employment Opportunity Commission, Pre-Employment Inquiries and Credit Rating or Economic Status (last visited Jan. 20, 2012), http://www.eeoc.gov/laws/ practices/inquiries_credit.cfm.

The U.S. Equal Employment Opportunity Commission, EEOC Public Meeting Explores the Use of Credit Histories as Employee Selection Criteria (last modified Oct. 20, 2011), http:// www.eeoc.gov/eeoc/newsroom/release/10-2010b.cfm.

The U.S. Equal Employment Opportunity Commission, Title VII: Employer Use of Credit Checks (last modified Mar. 9, 2010), http:// www.eeoc.gov/eeoc/foia/letters/2010/titleviiemployer-creditck.html.

National Employment Law Project, Discrimination Against Jobless Americans on the Rise (last modified Feb.16, 2011), http:// nelp.3cdn.net/586fef7ad31dc004dc_6em6i6fb u.pdf.

8. 11 Alive News, Job Listing; Unemployed Need Not Apply (last modified May 31, 2010), http://www.11alive.com/news/local/story. aspx?storyid=144719&catid=3.

9. New Jersey Statutes, Title 34, Chap. 8B, §§ 1-2-C.348B-1 to 34:8B-2 (A.3359/S.2388, approved Mar. 29, 2011); New York Senate Bill 5151.

10. The U.S. Equal Employment Opportunity Commission, EEOC Examines Employers’ Treatment of Unemployed Job Applicants at Hearing (last modified Feb. 16, 2011), http:// www.eeoc.gov/eeoc/newsroom/release/2-16-11. cfm.

11. Id. 12. Id. 13. The U.S. Equal Employment Opportunity Commission, Enforcement Guidance: Reasonable Accommodation and Undue Hardship Under the Americans with Disabilities Act (last modified Oct. 17, 2002), http://www.eeoc.gov/policy/ docs/accommodation.html.

14. The U.S. Equal Employment Opportunity Commission, Verizon to Pay $20 Million to Settle Nationwide EEOC Disability Suit (last modified July 6, 2011), http://www.eeoc.gov/eeoc/ newsroom/release/7-6-11a.cfm.

15. Id. 16. Id. 17. Consent Decree at 9-16, Equal Employment Opportunity Commission v. Verizon, et. al.

(Dist. Ct. Md. 2011) (No. 1:11-cv-01832-JKB).

18. Id. at 28.

19. Id. at 13.

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15

By Samantha Barlow Martinez

I How an Old

Cyber-Insubordination:

Labor Law Protects New Online Conduct

n an at-will employment state such as Texas, it would seem natural to advise an employer that it had the right to terminate an employee who called his supervisor a “scumbag” on Facebook and alluded to the supervisor’s “psychiatric” problems.1 The same advice seems logical if an employee posted on Facebook a picture of a company event, accompanied by demeaning and sarcastic remarks about the cheap nature of the event and the little respect it conveyed to the company’s clients,2 or if an employee called the company’s owner online an “[expletive deleted]” who “could not even do paperwork correctly.”3 And yet in each of these instances, an employer firing the employee in question could be liable for violating a 75-year old federal labor law designed to protect labor union activity – the National Labor Relations Act4 (NLRA). This is true even though Texas, as an at-will employment state, allows an employer to terminate an employee for any good, bad, or indifferent reason (subject to certain exceptions), and despite the fact that Texas is a “right to work” state, in which employees do not have to join a union that has organized their work group. Surprisingly, Section 7 of the NLRA applies to both union and non-union workplaces, and it protects the very conduct described above.

Legal Background of NLRA Section 7 Section 7 of the NLRA states, in relevant part: Employees shall have the right to selforganization, to form, join, or assist labor organizations, and to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.5 The National Labor Relations Board (NLRB), the government agency tasked with administering and enforcing the NLRA, as well as the courts, interpret

Section 7’s right to “engage in... concerted activities for... mutual aid or protection” to apply to union and non-union workforces alike. This provides the basis for protection of conduct that many employers consider insubordinate or disrespectful to the company or its management.

For an employee’s activity to be protected under Section 7, two tests must be met. First, the activity must be “concerted,” that is, engaged in with or on the authority of other employees.”6 Thus, if an employee speaks out about a term or condition of employment solely by and on behalf of himself, then the conduct is not concerted. Curiously, this does not mean that an employee speaking out alone is without the statute’s protection.

If a single employee “seek[s] to initiate or to induce group action” or “bring[s] truly group complaints to the attention of management,” then the conduct is concerted.7 Recently, the Board held that one employee who made a complaint at a staff meeting was engaging in concerted activity, even though he spoke out without the prior knowledge or support of his coworkers.8 The second test examines whether the concerted activity’s purpose is for “mutual aid or protection.” An employee action is for mutual aid or protection if its goal is to “improve terms and conditions of employment or otherwise improve [employees’] lot... through channels outside the immediate employee-employer relationship.”9 In Valley Hospital Medical Center, the NLRB found that a nurse’s public criticism of her employer-hospital’s level of patient care to local media was protected, despite the fact that the criticism did not relate directly to an ongoing labor dispute, because “patient welfare and working conditions are often inextricably intertwined.”10 Thus, employee criticism that occurs outside the workplace in a public forum, as well as criticism that touches topics tangential to working conditions, may well be protected.

However, there are limits on an employee’s protected conduct. An employee’s act may be “so disloyal, reckless, or

maliciously untrue [so as] to lose the Act’s protection.”11 In particular, when an employee engages in an outburst against management, a fact finder should consider (1) the place of the discussion; (2) the subject matter of the discussion; (3) the nature of the employee’s outburst; and (4) whether the outburst was provoked by an employer’s unfair labor practice.12 For example, an employee who called an executive a “[expletive deleted] idiot” to his supervisors, in response to a letter from the executive to employees which he had not even read, was not protected.13 Remedies for Section 7 Violations Section 8 of the NLRA makes it unlawful for employers (and unions) to engage in “unfair labor practices,” which would include retaliation against or interference with employees exercising their Section 7 rights.14 The employee’s remedy is not court action. Instead, she must file an unfair labor practice charge (ULP) with the NLRB.15 There is a six-month statute of limitations beginning on the date when the ULP was committed.16 The NLRB’s Regional Director may dismiss the charge, settle it, or issue a complaint.

For fiscal year 2011, the NLRB received 22,188 ULP charges, and found 37 percent to have merit.17 If a complaint is issued, then the NLRB’s Office of General Counsel prosecutes the charge on behalf of the aggrieved party, and the matter is heard before an administrative law judge.18 Adverse decisions may be appealed to the full Board, and from there appealed to a federal circuit court of appeals.19 The standard remedies for Section 7 violations are back pay and an order to post a notice regarding the violation at the workplace.20 In certain cases, the NLRB has also penalized employers by imposing the litigation costs for the adjudication proceedings, attorney’s fees, and union expenses involved in the litigation against the employer.21 Section 7 and Social Media The NLRB is breathing new life into Sec-

tion 7 by litigating multiple cases involving social media. In August 2011, the NLRB issued a report highlighting and analyzing its recent Section 7 social media cases22 and applied the concepts described above to employees’ online conduct.

For example, in Hispanics United of Buffalo, Inc.,23 an employee of a social services agency posted on Facebook statements regarding a coworker who complained about others, stating: “[Coworker’s name], a coworker feels that we don’t help our clients enough at [the agency;] I about had it! My fellow coworkers how do u feel?” Various employees responded to this, including statements such as, “What the [expletive deleted] try doing my job I have 5 programs” and “Tell her to come do [my] [expletive deleted] job... if I don’t do enough.” The attacked employee responded, “stop with [your] lies about me.” All of the posts occurred on a day off, using the employees’ own electronic devices.

The coworker who was the subject of the Facebook posts complained about the postings to management. The company investigated and found that the posts violated the agency’s policy on bullying and harassment, leading to the termination of the five employees.

An Administrative Law Judge (ALJ) found that the employees were unlawfully discharged for discussing “criticisms of their job performance.” The ALJ disregarded the fact that the employees neither tried to change working conditions nor communicated directly with their employer, instead emphasizing that the employees were working together to defend themselves against a reasonable belief that the coworker would report them to management: “Explicit or implicit criticism by a co-worker of the manner in which they are performing their jobs is a subject about which employee discussion is protected by Section 7.” Moreover, the ALJ rejected the employer’s argument that the employees’ actions were so “opprobrious” as to lose Section 7 protection.

Another example is Lee Enterprises, Inc.

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d/b/a Arizona Daily Star.24 In this matter, the Arizona Daily Star, a newspaper, encouraged reporters to use Twitter to drive traffic to the newspaper’s website. A reporter opened and maintained his own Twitter account, identifying himself as a Daily Star employee and linking to the newspaper’s website. In early 2010, the employee tweeted, “The Arizona Daily Star’s copy editors are the most witty and creative people in the world. Or at least they think they are.” Shortly thereafter, the newspaper’s managing editor met with the employee and told him that he “was prohibited from airing his grievances or commenting about the Daily Star in any public forum.” The employee continued tweeting, however, with tongue-incheek references to crime and homicides.

In September 2010, he made fun of a local TV station for a grammatical error, and a station producer complained to the paper. Management told the employee he could no longer tweet about work-related items, and the reporter discussed this action with his coworkers. He was terminated for failure to be respectful despite repeated warnings.

The NLRB Division of Advice recommended that this charge be dismissed for non-violation of the statute because the employee was neither discussing the terms of his employment nor trying to collectively act with other employees about the terms and conditions of employment. Although some of the management’s statements were overbroad (such as prohibiting all tweeting before clarifying that only work-related tweeting was to end), the firing was related to inappropriate posts instead of to protected activity touching conditions of employment.

In Karl Knauz Motors, Inc.,25 a BMW salesman attended a meeting with coworkers regarding his employer-dealership’s sales event, which had featured hot dogs, cookies, and chips. The salespeople complained collectively that the event should have been more formal, arguing that it would cheapen their product and lower their sales. A few days later, the salesman posted on Facebook, “I was 18

January/February 2012

happy to see that [the dealership] went ‘All Out’ for the most important launch of a new BMW in years… the new 5 series.

A car that will generate tens of millions of dollars in revenues for [the dealership] over the next few years. The small 8 oz bags of chips, and the $2.00 cookie plate from Sam’s Club, and the semi fresh apples and oranges were such a nice touch… but to top it all off… the Hot Dog Cart. Where our clients could attain an overcooked wiener and stale bun[s]...”

At the same time, the employee posted pictures from a customer accident in a Land Rover that occurred at an adjacent dealership also owned by his employer, and commented in part: “This is your car: This is your car on drugs... This is what happens when a sales Person [sic] sitting in the front passenger seat (Former Sales Person, actually) allows a 13 year old boy to get behind the wheel of a 6000 lb truck built and designed to pretty much drive over anything. The kid drives over his father’s foot and into the pond in all about 4 seconds and destroys a $50,000 truck.

OOOPS!” The dealership terminated the employee for the posts. The ALJ credited management’s testimony that the employee was fired only for the Land Rover incident. The ALJ opined that the food discussion was both protected, because it was tied to concerns about employee compensation, and concerted, because the employee’s posting, although done individually, was a “logical outgrowth” of the prior collective complaints. However, the Land Rover incident was not protected or concerted because it did not affect terms and conditions of employment, nor were other employees involved. In using this reasoning, the ALJ sidestepped the employer’s argument that the language and tone were so offensive as to lose the Act’s protection.

Section 7 and Employer Policies In a separate but related trend, the NLRB is also attacking overbroad employer policies regarding social media and use of electronic resources. For a policy to be

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overbroad, the Board need not show that the policy has had an actual adverse effect on employees, but rather that the policy has had a “chilling” effect that could potentially impact employees’ actions.26 The NLRB recently settled a case in which it alleged that an employer policy restricting disparagement of the company, management, coworkers, and competitors in its social media policy was unlawful.27 In another Advice Memorandum, the Office of General Counsel found that an employer’s social media policy prohibiting disclosure of personal information of co-workers and the use of company logos and photographs of stores unlawful because it could tend to keep employees from organizing together to protest conditions of employment, including passing out handbills or picketing using the company’s image.28 Section 7’s Message: Proceed with Caution The above examples demonstrate that an employee’s right to complain about an employer and to take online action in protest is much broader than common sense and traditional employment law would dictate. Companies should ensure that their social media policies (as well as other confidentiality and non-disparagement policies, among others) comply with Section 7 precedent. In addition, companies should pause before disciplining or firing employees for traditionally “insubordinate” or “disrespectful” conduct, because that conduct could be protected if related to terms and conditions of employment.

Samantha Barlow Martinez is a founding partner of the Houston firm Muskat, Martinez & Mahony, LLP, a managementside labor and employment law firm, and has extensive experience working with labor unions. She thanks Allison May for her research assistance.

Endnotes 1.

American Medical Response, Case No. 34-CA-12576 (Complaint and Notice of Hearing Oct. 27, 2010), cited in National Labor Relations Board Office of the General Counsel, Memorandum OM 11-74

issued August 18, 2011, available at https://www. nlrb.gov/news/acting-general-counsel-releasesreport-social-media-cases (hereinafter “NLRB Social Media Memo”) and complaint, available at http:// documents.jdsupra.com/daf37177-f935-4fe0-be1f82c65d0f2ac3.pdf.

2. Karl Knauz Motors, Inc., No. 13-CA-46452 (2011) (Biblowitz, Arb.), available at http://www.nlrb.gov/ cases-decisions/case-decisions/administrative-lawjudge-decisions, select 2011 Cases, then Case No. 13-CA-46452.

3. Unidentified case cited in NLRB Social Media Memo.

4. 29 U.S.C. § 151 et seq. The NLRA covers most employees of private employers, with the exclusion of public sector employees, airline and railroad workers, and agricultural and domestic workers.

5. 29 U.S.C. § 157 (emphasis added).

6. Meyers Industries, 268 NLRB 493, 497 (1984) (Meyers I), remanded sub nom. Prill v. NLRB, 755 F.2d 941 (D.C. Cir. 1985).

7. Meyers Industries, 281 NLRB 882, 887 (1986) (Meyers II), enfd. sub nom. Prill v. NLRB, 835 F.2d 1481 (D.C. Cir. 1987).

8. Worldmark by Wyndham, 356 NLRB No. 104 (2011), 190 L.L.R.M. 1121, 2011 NLRB LEXIS 63 at *4-8 (N.L.R.B. Mar. 2, 2011).

9. Valley Hosp. Med. Ctr., 351 NLRB 1250, 1252 (2007) (citing Eastex, Inc. v. NLRB, 437 US 556, 565 (1978), enfd. sub nom. Nevada Service Employees Union, Local 1107 v. NLRB, 358 Fed. Appx. 783 (9th Cir. 2009).

10. Id. 11. Emarco, Inc., 284 NLRB 832, 833 (1987). The U.S. Supreme Court has held that employee activity will lose the Act’s protection if the “means” of “the attack” on an employer are targeted to engender public criticism rather than draw attention to a labor dispute. NLRB v. Local Union No. 1129, IBEW (Jefferson Standard), 346 US 464, 475 (1953).

12. Atlantic Steel Co., 245 NLRB 814, 816 (1979).

13. Media General Operations, Inc. v. NLRB, 560 F.3d 181, 189 (4th Cir. 2009).

14. 29 U.S.C. § 158.

15. THE DEVELOPING LABOR LAW 2683 (John E. Higgins, Jr., et. al, editors, 5th ed. 2006) (1971).

16. See, e.g., USPS v. Marina Mail Processing Ctr., 271 NLRB 397, 400 (1984).

17. NLRB Performance and Accountability Report 2011 at 44, https://www.nlrb.gov/sites/default/files/ documents/189/nlrb_2011_par_508.pdf.

18. THE DEVELOPING LABOR LAW at 2695.

19. Id. at 2699.

20. Id. at 2747.

21. Id. at 2782-83.

22. NLRB Social Media Memo, supra note 1.

23. No. 3-CA-27872 (2011) (Amchan, Arb.) available at http://www.nlrb.gov/cases-decisions/case-decisions/ administrative-law-judge-decisions, select 2011 Cases, then Case No. 3-CA-27872.

24. No. 28-CA-23267 (2011). Information about this case was obtained from an Advice Memorandum issued April 21, 2011. The NLRB’s Office of General Counsel, Division of Advice, usually issues Advice Memoranda upon appeal of a complainant if the Regional Director dismisses his/her case. The Office of General Counsel reviews the case and opines about whether the case facts rise to the level of an NLRA violation, and then instructs the Regional Director to continue the complaint or affirms the dismissal. See NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 139-141 (U.S. 1975); see also NLRB website explaining purposes of advice memoranda, https://

www.nlrb.gov/cases-decisions/advice-memos.

13-CA-46452 (2011) (Biblowitz, Arb.), available at http://www.nlrb.gov/cases-decisions/casedecisions/administrative-law-judge-decisions, select 2011 Cases, then Case No. 13-CA-46452..

26. Lutheran Heritage Village-Livonia, 343 NLRB 646, 646 (2004). A rule is unlawful if it explicitly restricts Section 7 activities, or (a) employees would reasonably construe the language to prohibit Section 7 activities; (b) the rule is a response to union activity; or (c) the rule has been applied to restrict Section 7 rights. Id. at 646-47.

27. American Medical Response, supra note 1.

28. Giant Eagle, Inc, No. 6-CA-37260 (2011), available at http://www.nlrb.gov/cases-decisions/advice-memos, select 2011, then Advice Memo No. 6-CA-37260.

25. No.

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By Yasser Madriz, Felicity Fowler and Meghaan McElroy

Employees B Get

efore entering an unknown business market, employers must be apprised of the labor and employment laws governing the employer-employee relationship in that jurisdiction. This is especially true for Texas employers lookng to expand operations into Mexico, as Mexican law affords employees significantly more rights and benefits than Texas or United States federal law. With this summer’s upcoming presidential election in Mexico, many Texas employ-

What Texas Employers Need to Know About Mexican Labor and Employment Law

ers are likely monitoring the political and economic climate in Mexico to weigh the benefits of establishing new operations in Mexico or expanding current operations there. As these businesses continue to keep an eye on the presidential election, they should equally focus on becoming familiar with Mexican labor and employment law, as the divergent legal framework could sway certain businesses away from entering the Mexican market. Certainly, at a minimum, before Texas employers hire employees in Mexico, it is important to understand the basic differences in labor and employment law for an employer in Texas versus an employer in Mexico.

Likewise, businesses in Mexico may be more inclined to expand operations into Texas if they were aware of the favorable legal climate for employers. Recently, many Mexican companies have entered the Texas market and many more have

accelerated plans to expand into Texas at some future point. Accustomed to a legal framework that is consistently different than, and sometimes even contradictory to, the one in Texas, Mexican employers with Texas-based operations will be better prepared as they learn to structure their operations to comply with Texas and federal labor and employment law.1 Overview of Mexico’s Labor and Employment Law Framework Mexican labor and employment law is significantly more protective of workers than labor and employment law in the United States and Texas. Because Mexican law is based on a civil law system, codes or statutes primarily govern the employment relationship and dictate the terms of employment.2 Unlike the U.S. Constitution, the Mexican Constitution expressly recognizes and protects basic rights of workers in Article 123. In turn, the Ley Federal de Trabajo, or Federal Labor Law, implements Article 123 of the Mexican Constitution (among other statutes).3 The Federal Labor Law, first adopted in 1931 and amended in 1970, governs all aspects of the employer-employee relationship, including, without limitation, collective bargaining, the right to strike, minimum wage, work hours, occupational health and safety, profit sharing, and leave entitlements. Under the Federal Labor Law, an employment relationship exists whenever an individual renders personal services to another person or to an entity subject to that person’s control in exchange for the payment of a wage. Given this expansive coverage, most workers in Mexico are afforded the protections and rights of the Federal Labor Law. Importantly, foreign personnel in Mexico are subject to the same legal requirements as Mexican employees and are treated equally in terms of rights and obligations. Further, U.S.-based companies with Mexican subsidiaries cannot simply opt out of Mexican labor law by stating in their employment agreements that the agreement is subject to U.S. law

and courts. U.S. companies also cannot avoid the requirements of Mexican labor law by employing its Mexican personnel, who reside in Mexico and perform their services in Mexico, through a U.S. company. As a result, Texas companies should think twice before sending any U.S. employees to work in their Mexican operations or expending wasted efforts trying to avoid the application of Mexican labor law to its Mexican personnel.

The Employment Contract Requirement One major difference between employers in Texas and Mexico is the use of employment agreements. Generally, employers in Texas only enter into employment agreements with employees if: (1) the employee is a high-level executive; (2) the employer is employing the employee for a specific term; or (3) the employer wants to restrict the employee’s activities post-employment with restrictive covenants. In contrast, in Mexico, the terms of an employee’s employment must be in writing (unless a collective bargaining agreement applies to the employee), and employers will be held at fault for failing to carry out this formality.4 While an employer can comply with this written requirement by providing its employees a letter confirming the terms of their employment, it is advisable to provide employees with a formal written employment agreement signed by the employee.

Should a dispute arise, the employer will have the burden to prove the terms of employment and can then use the agreement signed by the employee to refute any contradictory terms the employee may allege.

The Federal Labor Law specifically lists what must be included in the written record of employment as follows: (1) the name, age, nationality, sex, marital status, and address of the employee and employer; (2) whether the relationship is for a specific project, term, or indefinite term; (3) the service(s) to be provided by the employee (as specific as possible); (4) the place(s) where the services will be performed; (5) the daily hours of work;

(6) the form and amount of wages; (7) the day and place of payment of wages; (8) an indication of the occupational training to be given to the employee; and (9) other employment conditions (e.g., vacation days) agreed to by the employee and employer.5 Aside from being required by law, it is important for employers to put the terms of employment in writing because if the services the employee will perform are not set out in writing, the Federal Labor Law provides that the employee shall only be obligated to carry out work which is consistent with the employee’s skills and the purpose of the business.6 Moreover, the Federal Labor Law makes clear that the absence of a written agreement will not deprive an employee of his or her rights.7 Consequently, the best practice is to follow the mandate of the law and put all employment terms in writing.

Texas employers unaccustomed to entering employment agreements with most employees may find this written requirement particularly daunting. Unfortunately, this requirement is only one of many that Texas employers must be aware of prior to employing employees in Mexico.

No Employment-at-Will In Texas, as in all U.S. states except Montana, employment relationships are presumed to be “at-will,” meaning that either the employer or the employee may terminate the employment relationship at any time, with or without notice, for any reason or no reason so long as the reason itself is not an illegal one. The atwill presumption is a default rule that can be modified by contract.

Not surprisingly, at-will employment is not the baseline rule in Mexico. Rather, the Federal Labor Law provides as a general rule that employment relationships are for an indefinite term.8 An employer may hire an employee for a specific project or a specified time period only if the nature of the work requires it. For example, an employer may hire an employee to temporarily substitute for another employee on leave or to work during the

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21

holiday season, as the purpose of such employment is specific and has a determined timetable. An employer may also hire an employee for a specific project with the agreement that the employee’s employment will end upon completion of the project. If the employment agreement is silent regarding duration, or, if contrary to the terms of the employment agreement, the actual circumstances do not warrant a limited employment term, Mexican law presumes an indefinite employment relationship.

Employees employed for an indefinite term can only be terminated for just cause, while employees employed for a specific project or specified term can only be terminated at the completion of the project or the expiration of the term, or for cause. The Federal Labor Law lists 15 causes for an employer to rescind the employment relationship without liability, as where the employee provides false references regarding the employee’s abilities, skills, and qualifications (effective only within the first 30 days of employment); in the course of his or her employment, engages in dishonest conduct or commits acts of violence against the employer, the employee’s family, or coworkers; causes damage to the employer’s property intentionally, or negligently of a serious nature; reveals trade secrets or confidential information to the detriment of the employer; is absent more than three times in a 30 day period unexcused; refuses to adopt preventive safety measures; shows up to work under the influence of drugs or alcohol; and engages in insubordination.9 If an employer terminates an employee for cause, the employer must give written notice to the employee of the date of termination and the reasons for termination. Failure to provide written notice of the reasons for termination shall be sufficient grounds to consider the employee’s termination unjustified and without cause.

A discharged employee may file a complaint with the Conciliation and Arbitration Board, an administrative agency charged with resolving labor disputes, to 22

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contest the employee’s termination.10 At the administrative trial, the employer has the burden of showing that the employee engaged in one of the specific culpable acts contained in the Federal Labor Law, and that the employer gave the employee written notice of the just cause for termination. If the employer fails to meet this burden, the employee may request either: (i) reinstatement to the employee’s previous job; or (ii) severance equivalent to three months wages based on the employee’s integrated compensation (which is all compensation, including benefits, that the employee can prove the employee received from the employer during the previous two years). Further, under certain circumstances, an employer can avoid the obligation of reinstatement by paying additional damages in the amount of 20 days of wages for each year in which the employee provided services.11 Regardless of the employee’s election of remedies, the employee is entitled to back wages from the date of termination until satisfaction of the award.

The Federal Labor Law additionally provides nine reasons for which an employee may terminate the employment relationship and receive severance upon termination. These causes include, without limitation, where the employer: deceives the employee as to the employment conditions (effective only within the first 30 days of employment); reduces the employee’s wages; maliciously causes damage to the employee’s tools; within the workplace, engages in dishonest conduct or commits acts of violence against the employee or the employee’s family; or exposes the employee to grave health or safety risks.12 To be entitled to damages upon such termination, the employee must end the employee’s employment within 30 days of the date on which the cause for the termination occurs.

In addition to terminations for cause, the employment relationship in Mexico shall terminate upon the mutual consent of the employer and the employee, upon the employee’s death, and upon the physical or mental incapacity of the employee

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that renders the employee’s work performance impossible.13 Absent one of these reasons for termination or clear justifiable cause, employers in Mexico must be very careful before terminating an employee or otherwise face steep severance in the form of statutory damages.

Employers operating in Texas clearly do not have as many constraints on terminating employees’ employment as employers in Mexico. Unless the parties explicitly contract for an employment relationship that can only be terminated by the employer with cause or by the employee with good reason, Texas employers generally have freedom to terminate an employee, without incurring any financial consequences, so long as the termination is not for a discriminatory or other legally-protected reason.

Mexican Employees’ Entitlements Aside from unemployment benefits and workers’ compensation benefits, if eligible, and the guarantee of receiving at least the federal minimum wage, Texas law does not mandate that private employers in Texas provide their employees with any substantive fringe benefits, such as holidays, vacations, breaks, bonuses, or severance. The only entitlements that Texas employees may (or must) receive are those provided by federal law. For example, the Family and Medical Leave (“FMLA”) entitles eligible employees of covered employers to take unpaid, jobprotected leave for specified family, medical, and military-related reasons.14 The Uniformed Services Employment and Reemployment Rights Act (“USERRA”) provides reemployment rights to employees who leave their job, voluntarily or involuntarily, to undertake military service.15 The Americans with Disabilities Act (“ADA”) provides qualified individuals with a disability a right to reasonable accommodations in the workplace.16 The Fair Labor Standards Act (“FLSA”) provides non-exempt employees with the right to minimum wage and overtime compensation for all hours worked in excess of 40 in a workweek.17 Texas em-

ployers, therefore, have wide discretion when determining what benefits, if any, to provide their employees, the wages they will receive, and the schedules they will work.

Mexican employers do not have this same, or even similar, latitude regarding employee benefits and entitlements. For example, the Federal Labor Law entitles employees to the following fringe benefits: (1) an annual year-end bonus equal to at least 15 days’ wages, payable prior to December 20th of each year; (2) paid vacation with the number of days based on the employee’s years of service; (3) a vacation premium, in addition to the employee’s full wages, of 25 percent of the wages payable during the vacation period; (4) seven paid legal holidays; and (5) annual profit sharing at 10 percent of the employer’s profits.18 Mexican law additionally provides employees who are terminated with or without cause, as well as employees who resign with 15 or more years of seniority, a seniority premium equivalent to 12 days’ salary for each year

of service rendered.19 The Federal Labor Law further provides wage and hour regulations for Mexican employees. Employees’ wages must be at or above the official minimum wage rates set by the National Minimum Wage Commission each year. Mexico divides the country into three geographic zones for purposes of the minimum wage rates, with Zone A, which includes Mexico City, having the highest rate. While Mexican law mandates a minimum wage, the minimum wage rates pale in comparison to the minimum wage in the United States (and Texas), which is currently $7.25 per hour. For example, the minimum wage in Mexico City is 62.33 pesos per day (approximately $4.64 U.S. dollars) for 2012.20 Accordingly, Mexican law may guarantee employees various benefits to which employees are not statutorily entitled in Texas, but employees in Texas have the potential to earn significantly more money than their Mexican counterparts.

The Federal Labor Law’s maximum

hours and overtime provisions further contribute to employees’ potential to earn more wages in Texas than in Mexico. Mexican law limits the amount of hours employees can work each day and the amount of overtime in a week. The maximum working day in Mexico is eight hours on the day shift (i.e., work performed between 6:00 a.m. and 8:00 p.m.), seven hours on the night shift (i.e., work performed between 8:00 p.m. and 6:00 a.m.), and seven and a half hours on shifts overlapping both the day and night shifts (provided that the night shift hours do not exceed three and a half hours).21 The working day includes all time during which the employee is at the employer’s disposal. The maximum number of hours that an employer may require its employees to work without having to pay overtime is 48 hours per week for the day shift, 42 hours per week for the night shift, and 45 hours per week for the swing shift. Further, employers may not require employees to work overtime for more than three hours a day three times

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a week and must compensate employees for this overtime work at double the normal rate.22 Moreover, employers must compensate employees who work more than nine hours of overtime a week at triple the normal rate.

Mexican law also entitles employees to a half-hour rest period during the work day, which is not computed as part of the seven, seven and a half, or eight hour shift as long as the employee can leave the workplace (otherwise it must be counted as part of the work shift). Employees additionally have a right to one day of paid rest for every six days worked.23 Because Sundays are the preferred rest day, employees required to work on Sundays are entitled to an additional 25 percent of their wages as a bonus.24 Employers and employees may agree to increase the maximum daily hours to provide for two days of rest instead of one (e.g., Saturday and Sunday), as long as the maximum weekly hours are observed.

While at first blush it may appear that employees in Mexico make out better than employees in Texas based on Mexico’s overtime rates, Sunday premium pay, and paid day of rest, this simply is not accurate. True, Texas employees are only entitled to one and a half times their regular rate of pay for all hours worked over 40 in a workweek under the FLSA, but Texas employees generally earn a significantly higher hourly rate than Mexican employees such that it makes employment in Texas more appealing and more lucrative.

Non-Competition Agreements Texas employers often seek to restrain the activities of their former employees post-employment through covenants not to compete, covenants prohibiting the solicitation of customers, and covenants prohibiting the recruitment of existing employees. The Texas Business and Commerce Code governs the enforceability of non-competition covenants in Texas and provides that a covenant is enforceable if the covenant: (i) is ancillary to or part of an otherwise enforceable agreement 24

January/February 2012

at the time the agreement is made; and (ii) contains reasonable limitations as to time, geographic area, and scope of activity restrained that do not impose a greater restraint than is necessary to protect the goodwill or other business interests of the employer.25 While the enforceability requirements for protective covenants under Texas law are highly technical and fact specific, covenants not to compete are allowed under the law and, in fact, there has been enhanced judicial enforcement of non-competition and non-solicitation provisions by Texas state courts.

Contrary to the legal regime in Texas, both the Mexican Constitution and the Federal Labor Law make clear that employee covenants not to compete are unenforceable in Mexico. Mexican courts have additionally consistently held unenforceable the lesser restraint of nonsolicitation of customer provisions.26 Consequently, Texas employers looking to expand into Mexico must understand this lack of protection afforded to their goodwill and business interests by Mexican law. Likewise, Mexican employees considering expansion into Texas should consider the use of non-competition and non-solicitation covenants, especially as they endeavor to gain footing in the Texas market.

Conclusion Because of the considerable substantive regulation of the employment relationship in Mexico, Texas employers may experience an initial “shock” when entering the Mexican market. Mexican businesses interested in expanding into Texas may experience a similar uneasiness given the highly unregulated employment relationship in Texas under state and federal law. Confronted with these differences, Texas and Mexican businesses may be inclined to forego their endeavors into the unknown employment climate of their neighbor. Texas and Mexican employers, however, should avoid this fear of the unknown, as the labor and employment landscape of each jurisdiction is easily maneuverable.

thehoustonlawyer.com

Yasser Madriz is a partner in the Business Litigation Section of Haynes and Boone in the firm’s Houston office. Felicity Fowler is a partner in the Labor and Employment Practice Group of Haynes and Boone in the firm’s Dallas and Houston offices. Meghaan McElroy is an associate in the Labor and Employment Practice Group in the firm’s Houston office.

Endnotes

Moreover, once Mexican employers are aware of the limited statutory entitlements and rights afforded by federal and Texas law to employees, they may want to reconsider the employment terms and benefits provided to their Texas employees.

2. Stephen F. Befort & Virginia E. Cornett, Beyond the Rhetoric of the NAFTA Treaty Debate: A Comparative Analysis of Labor and Employment Law in Mexico and the United States, 17 COMP. LAB. L. 269, 275 (1996).

3. Ley Federal del Trabajo [L.F.T.] [Federal Labor Law], Diario Oficial de la Federación [D.O.], 1 de Abril de 1970 (Mex.), available at http://www.diputados.gob.mx/ LeyesBiblio/pdf/125.pdf.

4. L.F.T. arts. 24 and 26.

5. Id. at art. 25.

6. Id. at art. 27.

7. Id. at art. 26.

8. Id. at art. 35.

9. Id. at art. 47.

10. Id. at art. 48.

11. Id. at arts. 49 and 50.

12. Id. at art. 51.

13. Id. at art. 53.

14. 29 U.S.C. § 2601, et seq. The FMLA applies to all public agencies and private employers who employ at least 50 employees within a 75-mile radius. Employees are only eligible for leave under FMLA if they have been employed for a minimum of 12 months (during the prior seven years, as time need not be consecutive) and worked a minimum of 1,250 hours in the 12 months immediately preceding a request for FMLA leave.

15. 38 U.S.C. § 4301. Unlike the FMLA, which has an employee numerosity requirement, USERRA applies to virtually all U.S. employers, regardless of size.

16. 42 U.S.C. § 12101. An employer must have 15 or more employees to be covered by the ADA. Similar to the FMLA and USERRA, employees must meet certain statutory coverage requirements before being eligible for the entitlement of a reasonable accommodation.

17. 29 U.S.C. § 8. As the term connotes, exempt employees under the FLSA are exempt from the minimum wage and overtime requirements; however, to qualify for exemption, employees generally must be paid at least $455 per week on a salary basis. The FLSA salary requirements do not apply to outside sales employees, teachers, and employees practicing law or medicine.

18. L.F.T. arts. 74, 76, 80, 87, and 117-25; see also Befort & Cornett, supra note 2, at 280.

19. However, the seniority premium may not exceed twice the minimum salary then in effect in the economic zone where the employer is located. L.F.T. art. 162.

20. Anthony Harrup, Mexico’s 2012 Minimum Wage Increase Set at 4.2%, WSJ.COM, Dec. 10, 2011, http://online.wsj. com/article/SB100014240529702034133045770910504 95760194.html.

21. L.F.T. art. 60-61.

22. Id. at arts. 66-68.

23. Id. at art. 69.

24. Id. at art. 71.

25. TEX. BUS. & COM. CODE ANN. §§ 15.50–.52.

26. Mex. Const. art. 5; L.F.T. art. 4.

1.

Equal Access

Champions

What does it take to become an “Equal Access Champion”? The firms and corporations listed below have signed 5-year commitment forms that indicate they will uphold a pledge to provide representation in a certain number of cases each year, based on the number of attorneys in the firm or legal department. The goal is to provide pro bono representation in at least 1,500 cases through the Houston Volunteer Lawyers Program each year, and to increase that goal each year. For more information contact Kay Sim at (713) 759-1133.

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By Benny Agosto JR. and Chelsie King Garza

Expanding P the Coming and Going Rule...

olice officers are never truly “off duty.” Twenty-four hours a day, seven days a week, they are expected to stop crime and enforce the oath they take upon graduating from police academy.

And yet, for one officer who was injured in the line of duty, Harris County’s workers’ compensation carrier drew a fine line as to what constitutes being “on duty.”1

One Officer’s Struggle

The Law in Texas on Course and Scope For Sergeant Eluid Hinojosa and employees across the state of Texas, whether their job-related injury will be covered by worker’s compensation insurance may depend on whether they were in course and scope of their employment at the time of injury. Before an injury may be classified as one sustained in the course of employment, it must meet two tests: (1) it must be of a kind or character originating in or having to do with the employer’s work; and (2) it must have occurred while the individual was engaged in the furtherance of the employer’s business or affairs.2 Section 401.011 of the Texas Labor Code provides, in pertinent part: “Course and scope of employment” means an activity of any kind or character that has to do with and originates in the work, business, trade, or profession of the employer and that is performed by an employee while engaged in or about the furtherance of the affairs or business of the employer. The term includes an activity conducted on the premises of the employer or at other locations. The term does not include: (A) transportation to and from the place of employment unless: (iii) the employee is directed in the employee’s employment to proceed from one place to another place...3 The Texas Supreme Court has stated, “[i]n general, injuries which occur while the employee is traveling to or from work are not compensable under the [Worker’s

Compensation] Act.” 4 Paragraph (A) of § 401.011 has become known as the “coming and going” rule, which “codifies what originated as early judicial attempts to delineate circumstances when employee travel to and from work would come within the Act’s ‘course and scope’ definition.”5 Early decisions reasoned that the employee’s travel to and from work would further the affairs of the employer, but determined as a general rule that such travel could not usually be said to originate in the employer’s business because “[t]he risks to which employees are exposed while traveling to and from work are shared by society as a whole and do not arise as a result of the work of employers.”6 This concept evolved into the general exclusion of employee travel to and from work from the course and scope of employment.7 “At the same time, however, courts came to recognize three chief types or circumstances in which employee travel to and from work could potentially come within the course and scope of employment (and would be, in effect, exceptions to the exclusion for ‘coming and going’ travel)—the three categories of employee travel ultimately codified in subparagraphs (i), (ii), and (iii)” of the coming and going rule.8 Consequently, when an employee in Texas is injured en route, the coming and going rule comes into play to determine if worker’s compensation insurance will cover the injuries.

Employee Travel Must Satisfy Two Elements of the General Course and Scope Definition Employee travel must satisfy two elements of the general course and scope definition in order to be compensable.9 As the court in Rose v. Odiorne noted, “proof of [employer-paid travel] does not entitle appellant to compensation but only prevents his injury from being excluded from coverage simply because it was sustained while he was traveling to or from work... [I]n order to prevail on the merits, appellant was required to prove... that the injury originated in the employer’s business and was sustained during the furtherance of the employer’s business.”10

The first element that must be satisfied is whether the employee’s travel originated in the employer’s business.11 The case law has demonstrated that this first element will be the most important in a summary judgment analysis or in making the ultimate decision on compensation.12 The second element of the course and scope definition is relatively easy to meet: does the travel further the affairs of the employer?13 An employee’s travel between home and work furthers the affairs of the employer because it makes the employment possible.14 This satisfies the second element. But because there is no bright line rule to determine what travel originates in the employer’s business, the facts of each individual case will be very important.

As a general rule, an employee’s travel originates in his employer’s business if the travel was pursuant to the express or implied requirements of the employment contract.15 “This reflects the underlying policy goal of allocating to the employer and insurance carrier the risks inherent in an employee’s job while leaving to the employee risks that are ‘shared by society as a whole and do not arise as a result of the work of the employer.’”16 When the employer requires the employee to travel as part of its business, for example pursuant to a contract of employment, “the risk of traveling stems from that business and properly can be said to arise as a result of the employer’s business.”17 When evaluating the origination of the employer’s business element, courts must consider the nature of the employee’s job, the circumstances of the travel, and any other relevant facts.18 Additionally, one “must bear in mind that the provisions of the Workers’ Compensation Act should be given a liberal construction to effect its purpose of compensating injured workers and their dependents.”19 The Special Mission is Probative of Whether the Travel Originated in the Employee’s Business When an employee is on a “special mission,” that is, when “the employee is directed in the employee’s employment to

proceed from one place to another place,” the employee is acting within the course and scope of employment, and injuries suffered while on the special mission are compensable.20 The fact that an employee is directed to report to work at a different time or a different location is, alone, not enough to establish the employee was on a special mission.21 Again, the probative question is whether the travel is required as part of the employment rather than simply reporting to work.

Employer Provided Transportation can also be Evidence that the Travel Originated in the Employee’s Business One fact that may be telling in the analysis of the coming and going rule is the employee’s mode of transportation. An employer’s provisions of transportation can be proof of origination, even though “the employer’s [mere] gratuitous furnishing or paying transportation as an accommodation to the worker and not as an integral part of the employment contract... does not by itself render compensable an injury occurring during such transportation.”22 Employer-provided transportation that amounts to a “necessity from the employer’s perspective and not just an accommodation” to the employee can be sufficient proof that the travel originated in the employer’s business.23 The “Continuous Coverage” Rule and Overnight Travel An employee is generally within the course and scope of his employment when the employer’s business requires him to travel away from the employer’s premises.24 In fact, relying on what has come to be known as the “continuous coverage” rule, the Texas Supreme Court has held that the course and scope of employment in cases of overnight travel is broad, extending even beyond the actual act of travel itself to include injuries sustained during “down time.”25 Should an employee be injured during overnight travel at the behest of his employer, the case law is clear that these injuries are compensable.

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For Police Officers, the Coming and Going Rule is Slightly Different “[B]ecause they retain their status as peace officers 24 hours a day, making the distinction between compensable or non-compensable injuries may be more difficult than cases involving other citizens.”26 The Fourteenth Court of Appeals in Houston used a test “that turns on one basic inquiry: in what capacity was the officer acting at the time [of the injury]?”27 The Fourteenth Court of Appeals further noted that the inquiry is generally a fact issue to be decided on a case-by-case basis.28 As a result of an officer’s duty, determining whether the injury is compensable may be a more laborious process.

What Does All of this Mean for Police Officers in the State of Texas?

The Day That Changed Sergeant Hinojosa’s Life On January 8, 2005, Sergeant Hinojosa was injured in a motorcycle wreck while

in the course and scope of his employment with the Harris County Constable’s Office, Precinct One.29 Harris County disputed his status as off duty and, in doing so, denied him the lifetime benefits that he became entitled to as a result of his length of service and the severity of his injuries.30 This particular day would forever change his life and would ultimately change the law in Texas.

Sergeant Hinojosa was scheduled to begin his regular shift with the Constable’s Office at 2:00 p.m. on that Saturday; however, as there was not a morning patrol supervisor for that Precinct, Sergeant Hinojosa signed on for duty around 10:00 a.m. that morning.31 It was customary and a requirement of his job to sign on with dispatch as the sergeant on call for the morning. This made Sergeant Hinojosa available to be called to a scene or to assist the deputies on duty. Sergeant Hinojosa and several other officers were working off-duty escorting funeral processions.32 During a break between processions, Sergeant Hinojosa, along with

Deputy Terrence Leonard and Deputy Rick Wagner, grabbed an early lunch at a Jack in the Box restaurant.33 Shortly before the collision in which he was injured, Sergeant Hinojosa received a walkie-talkie communication from Deputy Doug Crow, requesting his assistance as the supervisor on call for Precinct One.34 Deputy Crow had received a call from the shift supervisor in which he was ordered to assist a civilian in the voluntary commitment of an individual to a mental health facility. Sergeant Hinojosa agreed to meet Deputy Crow to advise him how to proceed and to provide supervisory oversight. Around 11:35 a.m., Sergeant Hinojosa called in to dispatch to report that he would be responding to the call from Deputy Crow. When the collision occurred, Sergeant Hinojosa was en route to meet Deputy Crow to assist with the voluntary commitment.35 Sergeant Hinojosa was admitted to Ben Taub Hospital with a traumatic brain injury and intracranial hemorrhage. He remained in a coma for some time as a result of those injuries. Secondary to the brain injuries, his right shoulder and arm were injured, his left wrist required surgical intervention and the placement of hardware, and his neck was injured, resulting in paralysis of his right side. Sergeant Hinojosa was permanently and totally disabled.

The Battle for Lifetime Benefits At this point, the five year battle for benefits began. The County took the position that Sergeant Hinojosa was outside the course and scope of his employment at the time of his injuries and therefore was not entitled to worker’s compensation benefits.36 The case ultimately ended up in district court. The bench trial concerned Hinojosa’s appeal of a decision of the Appeals Panel of the Texas Department of Insurance—Worker’s Compensation Division (“the Department”), in which the Department determined he was not acting in the course and scope of his employment when he was injured in a motor vehicle accident.37 The court ruled in favor of Sergeant Hinojosa. Harris

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County appealed the judgment.38 In two issues on appeal, the county contended the evidence was legally and factually insufficient to establish that Hinojosa was acting in the course and scope of his employment.39 The First Court of Appeals in Houston concluded that the evidence was legally and factually sufficient to support the trial court’s judgment40 The Texas Supreme Court did not grant the County’s petition for review, thereby upholding the decision of the First Court of Appeals.

Hinojosa was on Duty and Entitled to Compensation when He Responded to the Call The First Court of Appeals evaluated all of the evidence presented at the trial court, which included testimony from several acting police officers.41 Several officers testified that Hinojosa was required to respond to Deputy Crow’s request for assistance and he was on duty when he responded.42 The evidence supported the finding that Hinojosa was responding to a call for assistance while on duty—and thus in the course and scope of his employment.43 The court ultimately found that Hinojosa had signed on for work before he responded to the call for assistance.44 The Court took a position similar to what the Fourteenth Court of Appeals espoused in Blackwell: an “officer’s duty under the law is frequently, and sometimes the only, basis for determining when he is in the ‘course of employment.’”45 To adopt a contrary reasoning would be to “disregard that a police officer may, while going about his private affairs, find himself unexpectedly in the presence of brutal criminal activity.”46 The Court went on to state that to “hold that an officer should not expect to be compensated for injuries sustained by his attempts to enforce the law only encourages lawlessness.”47 Accordingly, the First Court of Appeals found that Sergeant Hinojosa was on duty when he accepted a call to report to work. At that point, he was entitled to compensation when injured in the line of duty, regardless of where he was.

What Does This Mean for Workers Across Texas?

Youngblood: The On-Call Plant Supervisor Circumstances similar to those found in Hinojosa were presented in Highlands Insurance Co. v. Youngblood.48 In Youngblood, a plant supervisor, Lloyd Youngblood (“Youngblood”) was traveling back to his employer’s premises to address an operational problem after his normal work day had ended.49 Youngblood was fatally injured while traveling back to the plant.50 The issue was whether Youngblood was acting in the course and scope of his employment while traveling back to the plant to address the operational problem.51 The court found that it was strictly within Youngblood’s discretion as to whether he needed to go back to the plant to address operational issues after hours and that he did not need an approval for that action.52 It was part of Youngblood’s duties to keep the mill running around the clock, 365 days a year.53 Youngblood was provided a radio by his employer and

was on call 24 hours a day.54 On the night of the incident, Youngblood received a call on the radio regarding a problem at the plant; he responded with a phone call and indicated that he was on his way to the plant.55 While en route, he was fatally injured in a car accident.56 Ultimately, the court held that Youngblood was “in the course and scope of his employment when his fatal automobile accident occurred by reason of his duties and responsibilities.”57 McVey: Going to Job-Related Training Conference Troy McVey was killed in a motor vehicle accident while driving to Houston for a job-related training conference.58 Chantal McVey, his beneficiary, filed for worker’s compensation benefits from Zurich American Insurance Company.59 Zurich denied coverage, claiming that McVey’s death was not compensable because he had not been acting within the course of his employment at the time of his fatal

Defending Texans Since 1994 Former Assistant United States Attorney Former Assistant District Attorney Founding Member of the National College of DUI Defense of Counsel Williams Kherkher LLP Law Offices of Ned Barnett

Gulf Freeway Office: 8441 Gulf Freeway, Suite 600 • Houston, Texas 77017 Downtown Office: 440 Louisiana, Suite 800 • Houston, TX 77002

713-222-6767 • www.nedbarnettlaw.com

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29

accident.60 McVey stopped to pick up a co-worker on his way to the conference; while en route he was involved in a motorvehicle accident that killed him.61 Zurich argued that as a matter of law McVey had been traveling to work and had not been acting within the course and scope of his employment and potentially implicated the “coming and going” rule.62 The court held that the “coming and going” rule did not apply to McVey’s travel and he was acting in the course of his employment at the time of death.63 McVey was not merely going to work, but was acting in accordance with his job responsibilities.

cases was in a profession requiring him to be on call 24 hours a day. This encompasses individuals beyond law enforcement and arguably includes individuals who are obligated to respond. This holding, together with the McVey decision, may have broader implications for workers in other industries; for example, off shore workers who are injured en route to off shore platforms. These cases mark a consistent expansion of those entitled to benefits and a reminder of the purpose of the Workers Compensation Act – to compensate injured workers and their dependents.

Conclusion In 2011, the Texas Supreme Court rejected the petition for review in McVey, thereby essentially ensuring that Hinojosa stands as the law in Texas when determining an officer’s on-duty status.

Hinojosa and Youngblood can be read together to cover those individuals who are on call, as the employee in each of those

Benny Agosto, Jr. is a partner with the law firm of Abraham, Watkins, Nichols, Sorrels, Agosto & Friend. He is board certified in Personal Injury Trial Law. Agosto is the Hispanic National Bar Association President for 2011-2012. Chelsie King Garza joined the law firm of Abraham, Watkins, Nichols, Sorrels, Agosto & Friend as a litigation associate in 2007 and primarily

focuses her practice in plaintiff’s prosecution, medical malpractice, and commercial litigation defense. Ms. Garza is a member of the State Bar Associations of Texas, New York & New Jersey.

Endnotes See Harris County v. Hinojosa, 294 S.W.3d 737 (Tex. App.—Houston [1st Dist.] 2009, no writ).

2. Id. at 740; Blackwell v. Harris County, 909 S.W.2d 135, (Tex. App.—Houston [14th Dist.] 1995, writ denied) (citing Biggs v. United States Fire Ins. Co., 611 S.W.2d 624, 627 (Tex. 1981); Dickson v.

Silva, 880 S.W.2d 785, 787 (Tex. App.—Houston [1st Dist.] 1993, no writ)).

3. Hinojosa, 294 S.W.3d at 740; TEX. LAB. CODE § 401.011 (12) (Vernon 2007).

4. Evans v. Ill. Employers Ins. of Wausau, 790 S.W.2d 302, 304 (Tex. 1990); see TEX. LAB. CODE, § 401.011(12)(A).

5. Zurich v. McVey, 2011 Tex. App. LEXIS 2384 at *3 (March 30, 2011).

6. Id. (quoting Evans, 790 S.W.2d at 305).

7. Id. 8. Id. 9. See Rose v. Odiorne, 795 S.W.2d 210, 213-24 (Tex. App.—Austin 1990, writ denied) 10. Id. (emphasis added).

11. Hinojosa, 294 S.W.3d at 740.

12. See TEX. LAB. CODE § 401.011(12).

13. Leordeanu v. American Protection Ins. Co., 2010 WL 4910133, at *1 (Dec. 3, 2010).

14. Id. 1.

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795 S.W.2d at 214.

2011 Tex. App. LEXIS 2384 at *4 (quoting Evans, 790 S.W.2d at 305).

17. Id. (citing Rose, 795 S.W.2d at 214).

18. See Meyer v. Western Fire Ins. Co., 425 S.W.2d 628, 629 (Tex. 1968).

19. Zurich, 2011 Tex. App. LEXIS 2384 at *5 (citing Albertson’s, Inc. v. Sinclair, 984 S.W.2d 958, 961 (Tex. 1999)).

20. Evans, 790 S.W.2d at 304; see TEX. LAB. CODE § 401.01l(12)(A)(iii).

21. Evans, 790 S.W.2d at 304.

22. Id. (citing Texas Gen. Indem. Co. v. Bottom, 365 S.W.2d 350, 353 (Tex. 1963)).

23. Id. (quoting Rose, 795 S.W.2d at 214).

24. Shelton v. Standard Ins. Co., 389 S.W.2d 290, 29394 (Tex. 1965); Aetna Cas. & Sur. Co. v. Orgon, 721 S.W.2d 572, 574-75 (Tex. App.—Austin 1986, writ ref’d n.r.e.).

25. See Shelton, 389 S.W.2d at 293-94 (employee injured crossing street from hotel to restaurant was in course and scope); Orgon, 721 S.W.2d at 575 (employee injured by broken glass in hotel was in course and scope).

26. Blackwell v. Harris County, 909 S.W.2d 135, 139 (Tex. App.—Houston [14th Dist] 1995, writ denied).

27. Id. 28. Id. at 140.

29. Hinojosa, 294 S.W.3d at 742.

30. Id. at 739.

31. Id. 32. Id. at 739.

33. Id. 34. Id. 15. Rose,

35. Id.

16. Zurich,

36. Id. 37. Id. 38. Id. 39. Id. 40. Id. 41. Id.

at 742. at 740-41.

42. Id.

v. Ill. Employers Ins. Of Wausau, 790 S.W.2d 302, 304 (Tex. 1990); see Blackwell, 909 S.W.2d at 139 (“An officer’s duty under the law is frequently, and sometimes the only, basis for determining when he is in the ‘course of employment.’”).

44. Hinojosa, 294 S.W.3d at 742.

45. Id. 46. Id. 47. Id. 48. See Highlands Ins. Co. v. Youngblood, 820 S.W.2d 242 (Tex. App.—Beaumont, 1991, writ denied).

49. Id. at 243-44.

50. Id. 51. Id. 52. Id. 53. Id. 54. Id. at 245-46.

55. Id. 56. Id. 57. Id. at 246.

58. Zurich, 2011 Tex. App. LEXIS 2384 at * 1.

59. Id. 60. Id. 61. Id. at 4.

62. Id.at 5.

63. Id.at 25.

43. Evans

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January/February 2012

31

By Joy E. Sanders

ImmigrationRelated Worksite Enforcement Actions: I-9s & Beyond

N

otwithstanding the pervasive rhetoric surrounding “job creation,” employers in the U.S. continue to face unprecedented scrutiny by the federal government with respect to enforcement of immigration laws. The stakes are high: enforcement actions can result in broad litigation exposure for publicly traded companies (including securities-law risks such as shareholder lawsuits), or complete dissolution of the entity and imprisonment of executives.1 The onslaught of such worksite enforcement actions can be attributed to a policy shift, made early by the Obama administration, away from investigating and prosecuting unauthorized workers and instead focusing resources on the employers who knowingly hire them. This shift, combined with other factors such as the formation of the Department of Homeland Security’s USCIS Office of Fraud Detection and National Security (“FDNS”) and associated data mining activities, have created a seemingly hostile environment 32

January/February 2012

for employers who increasingly face a myriad of new rules and compliance issues as local and state authorities attempt to annex the domain of federal authorities.

This article discusses the various enforcement actions that employers may be subjected to in this “enforcement-first” milieu and what can be done offensively to alleviate the employer’s burden and risks.

I. The so-called “silent raid”: I-9 audits In July 2009, the enforcement arm of the Department of Homeland Security Immigration and Customs Enforcement, or “ICE,” launched a new I-9 audit initiative in which 652 businesses received “Notices of Inspection” (NOIs). These audits are not new, but the announcement signaled the “increased focus on holding employers accountable for their hiring practices and efforts to ensure a legal workforce.”2 ICE subsequently released the underlying “Worksite Enforcement Strategy” policy memorandum in response to a Freedom of Information Act request by the American

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Immigration Lawyers Association (AILA).3 This memorandum made clear that DHS’s “finite resources” would focus enforcement on employers because such focus would “better target the root causes of illegal immigration.”4 The memorandum outlined three strategies: “1) penalize employers who knowingly hire illegal workers; 2) deter employers who are tempted to hire illegal workers; and 3) encourage all employers to take advantage of wellcrafted compliance tools.”5 The memorandum further emphasized that criminal prosecutions of business owners, CEOs, supervisors and managers would be a priority.6 Since then, ICE has made good on their promise, making headlines with actions against businesses ranging from retailers and restaurant chains to an electronic I-9 software vendor. And in June 2010, the CEO of Agriprocessors, a large slaughterhouse in Postville, Iowa, was sentenced to 27 years in prison following a government investigation stemming from allegations that the company hired unauthorized workers.7 So, who should be concerned about an I-9 audit? The answer is all employers. Indeed, all employers are required to complete a Form I-9 for all employees hired since November 6, 1986, and empirical evidence suggests that no industry is immune from ICE enforcement actions.8 In this high stakes environment, employers must be proactive to ensure that they are using their best efforts to comply with I-9 obligations. First, it is important to recognize that from ICE’s perspective, best efforts would include an employer’s opting-in to the use of employment verification “tools” such as E-Verify and IMAGE. Indeed, ICE expects employers to make a concerted effort at fulfilling I-9 obligations, beyond rudimentary completion of a Form I-9, through adopting and maintaining “written, accurate and consistent”(WAC) I-9 policies and procedures. Elements of such policies and procedures include training; ensuring only

trained employees complete I-9s; ensuring proper I-9 retention and whether ‘to copy or not to copy’ documentation used to complete an I-9; identifying the need for, scheduling and ensuring completion of I-9 updates and reverification; internal I-9 audits (third party or self-audit); methods for ensuring proper I-9 correction, where necessary; and systematic methods for reporting and responding to violations (I-9 and beyond, e.g. IRCA and Title VII).

Other important considerations include liability for contractor and subcontractor compliance, and liabilities of a successor corporation following a corporate reorganization, merger or sale of stock or assets.

Also making waves in the realm of immigration worksite enforcement is the April 2011 announcement of the return of Social Security Administration (SSA) “nomatch” letters.9 These letters are sent to employers to notify them of discrepancies between SSA records and employer-reported payroll data. The issue that arises is whether receipt of a no-match letter may constitute constructive knowledge that an employee is not authorized to work in the U.S., thus triggering the duty to investigate. These issues have not yet been resolved, but the “reasonable person standard” makes yet another appearance as a useful measure for determining whether the employer needs to take further steps and action. When information arises, such as receipt of a “no-match” letter or in the course of an internal audit, the employer should ask, would a reasonable person “be concerned about the legitimacy of the documents presented or the identity of the individual presenting these documents?”10 An employer should also be prepared to implement reactive measures in the case of a site visit or raid by ICE. Importantly, all levels of staff should know who to contact when a government representative makes contact or shows up. Similarly, when such a visit takes place, the employer should minimally obtain the officer’s name, title, affiliation and contact information (business card, if possible), and contact legal counsel as soon as possible. An ICE raid, involving service of a federal or state

search warrant, is often the culmination of months of prior investigation, including the use of cooperating witnesses, statements from former and current employees, confidential informants and body wiretaps, and usually involves partnering with agencies such as the U.S. Attorney’s Office, state and local police departments, the Social Security Administration, the Internal Revenue Service, the Department of Labor, the Department of Homeland Security’s Office of Inspector General, and the FBI.11 The I-9 inspection, or audit, is an evidentiary tool that ICE can use to obtain affidavits in support of search warrants.12 The process is initiated by service of a Notice of Inspection (NOI) that compels an employer to produce its Forms I-9 for review by ICE on a specified date and time.

The employer must be granted at least three business days’ notice. The employer will be allowed 10 business days to correct any technical or procedural violations, if found. If any such violations remain uncorrected, such violations will become substantive on the expiration of the 10day period and ICE will then notify the employer in writing of the results of the audit.

While civil fines, which range from $375 to $16,000 per violation, are common, they are now increasingly accompanied by criminal prosecution for knowingly making false statements on an immigration-related form (the Form I-9),13 “alien harboring,”14 criminal misuse of a Social Security Number where an employer knowingly relied on false documentation,15 making false statements to government officials,16 and identity theft.17 In this environment, it is easy to see how employers can benefit from legal counsel.

In U.S. v. New China Buffet Restaurant, the Department of Justice Office of the Chief Administrative Hearing Officer (OCAHO)18 granted DHS’s motion for summary decision, finding that an employer’s failure to properly complete Section 2 of the Form I-9 within three business days of hiring an employee is a substantive violation, not a technical or procedural one.19 This is significant because, as noted above, the stat-

ute allows for a 10-day period to correct technical and procedural errors, whereas no such relief is available for substantive violations.

The OCAHO decision in U.S. v. Snack Attack Deli Inc. involved a charge of 108 separate violations for failing to properly maintain Form I-9.20 The Administrative Law Judge (ALJ) sustained the charge, but rejected ICE’s proposed fines of $111,078.21 Even though the court found that the employer had made virtually no effort to comply with its I-9 obligations, the ALJ reduced the total fine imposed to $27,150.22 The value of the decision is the ALJ’s application of the five relevant statutory factors for consideration under the Immigration Reform and Control Act of 1986 (IRCA)23 in determining the amount of fines. The application of these factors offers guidance to lawyers representing employers in negotiating a reduction of fines with ICE or in seeking to mitigate the fines imposed before an ALJ. There are other contexts in which an employer’s I-9s might present litigation risks. As employers scramble to assume greater responsibility for policing their I-9s, “they risk greater exposure to claims of immigration-related discrimination.”24 In addition to the predominantly wellknown Federal, State and local laws governing employment discrimination, “the Immigration Reform and Control Act of 1986 (IRCA) proscribes a number of different forms of ‘unfair immigration-related employment practices.’”25 These include enhanced applicability of national origin discrimination,26 citizenship discrimination and document abuse.27 Accordingly, to avoid immigration-related discrimination, the employer’s “tool belt” should also include and mandate the use of uniform application forms and interview questions to ensure that prospective employees are asked about their eligibility to work without raising claims of national origin or citizenship discrimination.28 II. FDNS and “site visits”: on-site fraud inspections of immigration petitions In recent years, the U.S. Citizenship and

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January/February 2012

33

Immigration Services (USCIS) has ramped up inspections of work sites for which immigration sponsorship petitions have been filed to employ foreign nationals on a temporary, or “nonimmigrant,” basis.

USCIS formed the Office of Fraud Detection and National Security (“FDNS”) in 2004 to address concerns of national security and immigration benefit fraud that were posed in the aftermath of 9/11. Specifically, FDNS aims to determine whether individuals or organizations filing for immigration benefits pose a national security threat, and to detect and deter immigration benefit fraud.29 FDNS operates largely behind the scenes, resolving background check information during government adjudication of petitions, conducting fraud and compliance assessments, and maintaining a centralized database (FDNS-DS) of information. Typically, this type of enforcement investigation has involved scrutiny of H-1B employers to ensure compliance with requirements of filing of a Labor Certification Application (LCA) with the De-

partment of Labor, which is essentially a prerequisite to filing a petition with USCIS requesting employment authorization for a foreign national in H-1B classification.

This type of investigation is predominately conducted by a contractor who is not a government employee. These inspectors are not sworn law enforcement personnel and do not have authority to detain or arrest, issue warrants, or take testimony. DHS cites its right to verify eligibility information “at any time” pursuant to 8 U.S.C. §§ 1103, 1155, 1184 and 8 C.F.R. Parts 103, 204, 205 and 214, as the legal authority for this type of review. In addition, the most recent version of USCIS Form I-129, the form that is used to petition for the majority of nonimmigrant visa classifications, includes a signatory attestation that authorizes the release of information from the petitioning party (the employer), and acknowledges the authority of USCIS to conduct audits via both open source information as well as on-site “compliance reviews.”

In the case of H-1B site visits, the visit

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is typically made post-adjudication, i.e. after USCIS has approved the H-1B petition. As in the case of an ICE raid, the element of surprise is central; the inspector arrives unannounced. However, contrary to its ICE counterpart, the H-1B site visit is predominantly the result of random selection.

A government officer reviews the results of site visits and determines what action to take. Any derogatory information obtained in the course of a site visit will result in referral to either the FDNS for further administrative investigation or, where sufficient evidence exists, to adjudications. The latter type of referral may result in denial of a pending petition or the re-opening of an approved petition to re-adjudicate and/or revoke the petition.

Additionally, the latter type of referral may also generate further investigation for the purpose of pursuing civil penalties and/or criminal prosecution.

Not only are employers who “sponsor,” or file for immigration benefits on behalf of employees subject to this type of government scrutiny; site visits may be initiated at the declared place of employment, which may involve a third party worksite.

Therefore, participating employers should work with legal counsel to ensure regulatory compliance with respect to applicable immigration programs at all worksites.

Again, employers’ personnel should know who to contact internally in the event of a site visit and how to obtain the inspector’s information, and the employer should contact legal counsel as soon as possible.

III. The U.S. Supreme Court’s approval of Arizona’s E-Verify law and the rise of state and local efforts to regulate immigration The U.S. Supreme Court’s recent decision in Chamber of Commerce of the United States v. Whiting30 upheld an Arizona law that requires employers to use E-Verify in order to operate within the state.31 The Court made clear that “[a] State, locality, municipality, or political subdivision may exercise its authority over business licensing and similar laws as a penalty for failure to use the verification system.”32 Other

states have already enacted similar laws, which are sure to present a host of issues for the courts and uncertainty for employers. The Whiting ruling “exposes some of the tensions and contradictions in modern preemption doctrine,” and is likely a signal of things to come from the high court.33 IV. Conclusion Enacted in 1986, IRCA has created a regulatory environment that often places employers in a catch-22 situation. Am I scrutinizing too little or too much? Do I retain a copy of verification documents or does retention create greater risk? Should I keep the physical documents or store them online? And, should I participate in government employment eligibility verification programs? Although the answers to these questions have not necessarily become clearer, the need for employers to find answers has become more important.

And these issues are not likely to dissipate, as actions under IRCA are ever increasing and a change in the U.S. immigration laws is not likely to decrease the burden on employers. IRCA is not new, but its vigilant enforcement by various government agencies is not something that can remain on the proverbial back burner any longer.

Once employers become aware of this enforcement effort, there is a clear pathway forward that can provide peace of mind and confidence when the federal government comes knocking.

InfoNet at Doc. No. 09100572 (posted Oct. 5, 2009) (on file with author).

4. Id. 5. Id. 6. Id. 7. Mira Mdivani, ICE Worksite Enforcement Chief: ‘We Are Going After Employers,’ Society for Human Resource Management (July 23, 2010), available at http:// www.shrm.org/LegalIssues/FederalResources/Pages/ ICEWorksiteEnforcement.aspx (sub. req.).

8. Id. 9. SSA refers to these letters as decentralized correspondence (DECOR) letters. These letters were stopped in 2007 due to litigation over proposed DHS regulations relating to safe harbor procedures for employers who receive no-match letters, which were never implemented.

10. Bo Cooper, et al., The New Look of Worksite Enforcement, AILA’S GUIDE TO WORKSITE ENFORCEMENT & CORPORATE COMPLIANCE 57 (2008), at 67.

11. Josie Gonzales and Nancy-Jo Merritt, The Anatomy of an ICE Raid, AILA’S GUIDE TO WORKSITE ENFORCEMENT & CORPORATE COMPLIANCE 179 (2008), at 179-184.

12. Id. at 180.

13. 18 U.S.C. § 1546(a).

14. INA § 274(a)(1)(A)(iv).

15. 42 U.S.C. § 408(g)(2).

16. 18 U.S.C. § 1001.

17. 18 U.S.C. § 1028; see generally Avram Morell et al., Playing Defense: Advising Clients on Immigration Compliance in an Era of Worksite Enforcement, IMMIGRATION & NATIONALITY LAW HANDBOOK 993 (AILA 2009-10 Ed), at 994 [hereinafter Playing Defense].

18. The OCAHO has jurisdiction over three types of cases arising under the Immigration and Nationality Act as amended (INA), including those involving allegations of: (1) knowingly hiring, recruiting or referring for a fee or the continued employment of unauthorized aliens and failure to comply with employment verification requirements

in violation of INA § 274A (employer sanctions); (2) immigration-related unfair employment practices in violation of INA § 274B; and (3) immigration-related document fraud in violation INA § 274C. See generally The United States Department of Justice, “About DOJ” section on Office of the Chief Administrative Hearing Officer, available at http://www.justice.gov/eoir/OcahoMain/ ocahosibpage.htm.

19. U.S. v. New China Buffet Restaurant #1132, (OCAHO Case No. 10A00016, March 18, 2010), available at http:// www.justice.gov/eoir/OcahoMain/publisheddecisions/ Looseleaf/Volume10/1132.pdf.

20. U.S. v. Snack Attack Deli Inc., D/B/A Subway Restaurant #3718, (OCAHO Case No. 09A00025, Dec. 22, 2010), available at http://www.justice.gov/eoir/OcahoMain/ publisheddecisions/Looseleaf/Volume10/1137.pdf.

21. Id. 22. Id. 23. See 8 U.S.C. § 1324a(e)(5).

24. Playing Defense at 1000.

25. Id.; see also IRCA, Pub. L. No. 99-603, 100 Stat. 3359.

The Department of State’s Office of Special Counsel for Immigration-related Unfair Employment Practices (“OSC”) is charged with enforcing these discrimination provisions.

26. For instance, discrimination rules under IRCA apply to employers with 4-14 employees, whereas ‘Title VII’ applies only to employers with 15 or more employees. Playing Defense at 1000.

27. See generally Playing Defense. at 1000-02.

28. Id. at 1003.

29. The latter goal is pursuant to a Memorandum of Understanding (MOU) between USCIS and ICE, effective February 14, 2006.

30. Chamber of Commerce of the United States v. Whiting, 563 U.S. ___, 131 S. Ct. 1968 (2011).

31. Id. 32. Id. 33. Lauren Gilbert, Immigrant Laws, Obstacle Preemption and the Lost Legacy of McCulloch, BERKELEY JOURNAL OF EMPLOYMENT AND LABOR LAW, VOL. 33

Joy E. Sanders is of counsel to The Ezer Law Group PLLC and is a member of The Houston Lawyer editorial board. She concentrates her practice in the area of immigration law. She may be contacted directly at sandersj@ezerlawgroup.com.

Endnotes 1.

2.

3.

Angelo A. Paparelli and Ted J. Chiappari, Informational Abundance and Scarcity in Immigration Worksite Enforcement, NEW YORK LAW JOURNAL, June 22, 2011, available at http://www.seyfarth.com/dir_docs/publications/ AttorneyPubs/Article061711.pdf.

News Release, U.S. Immigration and Customs Enforcement, ICE launches initiative to step-up audits of businesses’ employment records (July 1, 2009) (on file with author), available at http://www.ice.gov/news/ releases/0907/090701washington.htm.

ICE Memorandum, Marcy M. Forman, Worksite Enforcement Strategy (April 30, 2009), published on AILA

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November/December 2011

35

By Paul Harris

P The

Schnapper Trio

Significant Employment Opinions from the U.S. Supreme Court Drawings by courtroom artist Art Lien

36

January/February 2012

thehoustonlawyer.com

rofessor Eric Schnapper secured three victorious opinions from the Supreme Court in 2011. Who would have thought that a plaintiff’s lawyer could prevail three times based on two decisions by Antonin Scalia? Yet, here is the proof: Thompson v. North American Stainless, L.P., 131 S.Ct. 863 (2011); Kasten v. Saint-Gobain Performance Plastics Corp., 131 S.Ct. 1325 (2011); Staub v.

Proctor Hosp., 131 S.Ct. 1186 (2011).

Aside from Schnapper’s brilliance, one of the common threads between these cases is that more groups of people and more types of employment situations are covered by existing laws. Thompson holds that employees beyond those that make or support a charge of discrimination can be protected from retaliatory actions. Kasten holds that employees that oppose wage and hour violations are protected even if they only present their complaints orally.

And Staub holds that employees who are targeted by a biased supervisor are protected even when the biased supervisor is not the ultimate decisionmaker.

Professor Schnapper’s success speaks to his great skill and intellect, along with that of the lawyers who took the cases initially and carried them through the lower courts. But it also speaks to a recognition by the Supreme Court of how broadly the protection of remedial workplace laws spread. In a year that also featured the ominous Wal-Mart Stores, Inc. v. Dukes1 decision, “Schnapper’s trio” is certainly a bright spot for employees and their attorneys. And on the bright side for defense attorneys, it provides something new to warn their clients about.

A Professor in the Trenches Professor Schnapper molds young legal minds at the University of Washington School of Law. His educational pedigree includes two degrees from Johns Hopkins, a master’s in philosophy from Oxford, and a law degree from Yale.2

who was terminated. Burlington frames ation. Based on the opinion’s examples, In addition to his career in academia, the question thusly: is it an act that the zone of interest includes employees Schnapper served as an assistant counsel would dissuade a reasonable worker from seeking protection from their employer, to the NAACP Legal Defense and Educabut would exclude a more tangential victional Fund for 25 years. tim, such as a shareholder of a discrimiAnd as an appellate lawnatory company.18 Thompson was not yer, his name is found in an “accidental victim” of his employer’s almost every seminal Suretaliation.19 NAS intended to injure him preme Court case dealing with employment law, inas a way to harm Regalado. That makes cluding: him an aggrieved person within the zone • Oncale v. Sundowner of interest.

Offshore Oil Co., 523 Bottom Line: Third party retaliation U.S. 75 (1998) is actionable if it meets the Burlington • Reeves v. Sanderson Northern standard of retaliation. Even if “Schnapper’s Trio” is a bright spot for employees and their attorneys Plumbing, 530 U.S. the third party did not formally “oppose” 133 (2000) the discrimination or participate in the making a complaint?10 Well, would you • Ash v. Tyson’s Food, 546 U.S. 454 charge process, if he suffered a Title VIIlike to plan a wedding reception on one (2006) type injury and he is within the category income?

• Burlington Northern R.R. v. White, of people Title VII is designed to cover, he But what if Thompson was just Regala548 U.S. 53 (2006)3 may sue under Title VII. do’s boyfriend? Or, what if Thompson was just a close friend and not even boyIf you had that kind of track record, Kasten v. Saint-Gobain friend material because he never noticed what would you charge to brief and arNow to the definition of “any.” As in, when Regalado got her hair cut? While gue a case before the Supreme Court? But does “any complaint” include an oral firing a close family member is clearly Schnapper is a steal. He is a full-service 11 complaint? This was the central question retaliatory, whether some other relaappellate lawyer and he does it all pro in Kasten v. Saint-Gobain.20 Lawyers do bono. According to him, “It’s a privilege tionship is close enough to be protected to get involved.”4 Whenever possible, he depends on the context.12 The standard not get paid for the time it takes to put on and take off their lawyer costumes, but wants the client to be there for the oral is an objective one, however, and Burlingplenty of factory workers are supposed to argument because “these aren’t just iston Northern will be the guide.13 5 be paid for “donning and doffing” their sues, these are real people.”

The fiancée, Regalado, can sue, but uniforms and protective gear. Because the Here is what you need to know about what about the fiancé, Thompson? After time clock at the Saint-Gobain plant was the legal issues these real people faced. satisfying himself that the idea that peolocated in a room beyond the dressing ple would become engaged to be married area, Kevin Kasten repeatedly made comThompson v. North American existed at the time of the founders, Scalia plaints that he was not being properly Stainless (NAS) turned to the statute, which permits any compensated for his time spent changing In Thompson, prospective bride Miriam person “claiming to be aggrieved” to file clothes.21 He complained high and low, Regalado filed a discrimination charge suit.14 It could be that that phrase is coagainst her employer, NAS.6 NAS sent a extensive with Article III standing: (1) inbut always orally, and always to no avail. jury in fact, (2) that was caused message three weeks later by firing her by the defendant, and (3) can be prospective groom, Eric Thompson. remedied by a court.15 But Title Two questions arose: (1) is the act of firing the fiancé of an employee that VII standing does not stretch complains of discrimination unlawful, quite that far; nor is it so narrow and if so, (2) who is entitled to sue for as to only include the person en7 that violation? The Supremes had “little gaged in protected activity.16 8 difficulty” with the first question. JusInstead, Title VII standing is tice Scalia followed Burlington Northern conferred on “aggrieved perR.R. v. White,9 in writing that it is unlawsons” within Title VII’s “zone of interest.”17 If you have an interful to go after the complainant’s fiancé.

That means that Regalado had standest “arguably [sought] to be pro- Justice Breyer wrote for the majority in Kasten v. Saint-Gobain ing to sue for the termination of her fitected” by Title VII’s prohibitions, you are As such, Saint-Gobain denied that Kasten ancé, even though she was not the one among those who can be safe from retalimade “any significant complaint.”22 From thehoustonlawyer.com

January/February 2012

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the company’s perspective, Kasten repeatedly violated company policy by failing to clock-in and clock-out properly, and thus had to be fired.23 To determine whether Kasten’s complaints were protected, the Court had to decide whether oral complaints are protected under the Fair Labor Standards Act (FLSA). The FLSA prohibits retaliation “because [an] employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to the [FLSA], or has testified or is about to testify in such proceeding, or has served or is about to serve on an industry committee.”24 Justice Breyer, writing for the majority, admitted that this passage is susceptible to different interpretations. “Filed” can connote varying degrees of formality and can encompass either oral or written submissions, and the use of the word “any” to modify “complaint” conveys that a broad range of complaints are covered.

Nevertheless, the Court found that the language of the clause alone did not settle the issue.25 The Court looked further, to the “functional considerations” underlying the FLSA, to discern whether Congress intended to cover oral complaints.26 Because enforcement of the FLSA depends on information and complaints from employees seeking to vindicate their rights, such vindication should not depend on the form of the complaint received, especially considering that many covered workers may not be sophisticated or literate enough to present complaints in writing.27 The Court also held that a complaint must be sufficiently clear to give the employer “fair notice” that a protected complaint is being made.28 Breyer noted that this standard is already built into the elements of a retaliation claim. A plaintiff must prove causation—that he was fired “because” of the complaint he filed—and it would be impossible to clear that hurdle without showing that the defendant knew or should have known about the complaint.29 38

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For its part, Saint-Gobain argued that even if an oral complaint is sufficient, the complaint must be made to the Government to be protected. The language of the provision, quoted above, arguably suggests just that. It mentions “proceeding[s]” and “industry committee[s],” but nothing about employers or private industry.30 Breyer dodges this question on grounds that Saint-Gobain failed to raise it in response to Kasten’s cert petition,31 but Justice Scalia begs to differ.

After reminding us of his distaste for holistic statutory interpretation,32 he makes a solid argument that SaintGobain did preserve the question. In its response to the cert petition, it reframed Kasten’s question presented from, “[i]s an oral complaint of a violation... protected conduct?” to “[h]as an employee... [that] orally asserted objections to his employer... filed ‘any complaint’?”33 Scalia cuts to the heart of it: “While claiming that it remains an open question whether intracompany complaints are covered, the opinion adopts a test for “filed any complaint” that assumes a “yes” answer—and that makes no sense otherwise.”34 Bottom Line: Employees that make oral complaints of FLSA violations are protected from retaliation.35 Staub v. Proctor Hospital For those of us who did not see the sometimes harsh welcome for veterans returning from Vietnam, it may be hard to believe that some people have a bias against military service members, but that is why there are laws like the Uniformed Services Employment and Reemployment Rights Act (USERRA).36 It is not hard to believe that people who have a bias, but are not decisionmakers, still manage to find a way to act out against the objects of their bias. The final case in the trio presents what Judge Posner’s Legal Fables refers to as a “cat’s paw” situation. A clever monkey (the biased supervisor) uses a cat

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(the decisionmaker) to remove walnuts (the employee) from a fire.37 The cat’s paw takes the heat and the monkey gets what it wants.

Scalia wrote cat’s paw liability into Supreme Court jurisprudence with Staub v.

Proctor Hospital.38 After satisfying himself that cats existed at the time of the framers, Scalia builds his decision on foundations of tort law: (1) proximate cause only requires a direct relationship between the injury and the injurious conduct, and (2)

exercise of judgment by one agent does not prevent the earlier actions and motive of another agent from being a proximate cause.39 Only a proximate cause that is “too remote, purely contingent, or indirect” can break the causal chain.40 In this case, two of Staub’s supervisors held a bias against him because of his Army reserve obligations. One of the biased supervisors issued him a “Corrective Action” warning. The only problem was that this warning was based on a nonexistent policy that Staub had never violated. A few months later, the other biased supervisor claimed that Staub had violated the Corrective Action, but that too was a falsehood.41 To summarize, Proctor Hospital’s agents had an anti-military bias, intended to cause an adverse employment action, and took actions that directly resulted in the sought-after action. That means the biased agents were a proximate cause of the termination.42 The decisionmaker may also be a proximate cause, but plenty of injuries have more than one proximate cause. Just ask

Ms. Palsgraf. The decisionmaker’s exercise of judgment is not necessarily a superseding cause. It only supersedes the biased motive if it has an “independent origin that was not foreseeable.”43 Since Proctor Hospital’s decisionmaker decided to fire Staub based on completely bogus allegations from the biased supervisors, her decision cannot be said to be independent of the actions and motives of those biased agents.44 Justice Alito thinks that the employer is absolved if its decisionmaker undertakes an “independent investigation.”45 But, Scalia says that such a rule would create a situation where discrimination could never be challenged. An employer could simply pick an executioner to make all employment decisions, isolate her from any supervisor, have her review the personnel file before making a decision, and let the axe fall where it may.46 Instead, the majority opinion will hopefully induce employers to more carefully consider the scope and conclusions of their internal investigations.

Bottom Line: If a supervisor/agent takes an action motivated by illegal bias and intends to cause an adverse employment action, and that action is a proximate cause of the ultimate employment action, then the employer is liable. Even if a decisionmaker conducts an “independent investigation” and rejects an employee’s allegation of discrimination, that does not wipe away the effect of the earlier discrimination.

Conclusion No matter the side of the bar on which you practice, it is inspiring to see a lawyer perform at such a high level. Professor Eric Schnapper is on a roll.47 “Schnapper’s trio” ensures that more people and more situations are protected under these remedial laws. Much like the invigorated ADA shifts the focus away from coverage and toward causation,48 so too does this trio shift the focus toward the question that really matters: whether the plaintiff can prove that the employer violated the law.

Paul Harris is an associate at Butler & Harris, where he practices employment law. He can be reached by email at paul@butlerharris.com.

Endnotes Wal-Mart Stores, Inc. v. Dukes, 131 S.Ct. 2541 (2011).

2. ERIC SCHNAPPER | UW SCHOOL OF LAW, http://www.law.washington.edu/directory/ profile.aspx?ID=155 (last visited Jan. 25, 2012).

3. Eric Schnapper, Curriculum Vitae (Dec. 11, 2011), http://www.law.washington.edu/ directory/CV/SchnapperEric.pdf 4. The National Law Journal, Appellate Lawyer of the Week: Eric Schnapper, University of Washington Law School, by Tony Mauro (Oct. 27, 2010) available at http://www.law. washington.edu/News/Articles/Appellate_ Lawyer_of_the_Week.pdf.

5. Id. 6. Thompson, 131 U.S. at 867.

7. Id. 8. Id. 9. Burlington Northern R.R. v. White, 548 U.S. 53 (2006). Yet another feather in Prof. Schnapper’s cap.

10. Thompson, 131 U.S. at 868.

11. There have been several such suits since Thompson. See Zamora v. City of Houston, 2011 WL 1834245 (5th Cir. May 12, 2011) (retaliation against son because of protected activity by father); EEOC v. Willamette Tree Wholesale, Inc., 2011 WL 886402 (D. Or. March 14, 2011) (retaliation against brother because of protected activity of sister); McGhee v. Healthcare Services Group, Inc., 2011 WL 818662 (N.D. Fla. March 2, 2011) (retaliation against husband because of protected activity by wife; employees worked at the same site for two different companies); Smith v.Vilsak, 2011 WL 1691007 (EEOC, April 25, 2011) (retaliation against husband because of protected activity by wife).

12. See id.

13. Id. at 868-69.

14. Id. at 869, quoting 42 U.S.C. § 2000e-5(f)(1).

15. Id. (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-561 (1992)).

16. Id. 17. Id. at 870.

18. Id. at 869-70.

19. Id. at 870.

20. 131 U.S. 1325 (2011).

21. Id. at 1329-30.

22. Id. at 1330.

23. It was a bit ironic for Kasten to be punished for complaining about a potential FLSA violation since Saint-Gobain’s Code of Ethics “impos[es] upon every employee ‘the responsibility to report... suspected violations of... any applicable law of which he or she becomes aware.’” Id. at 1329.

24. Id. at 1329 (quoting 29 U.S.C. § 215(a)(3)).

25. Id. at 1330-32.

26. Id. at 1333.

27. See id. at 1333-34.

28. Id. at 1334.

29. Id. at 1334-35.

30. See 29 U.S.C. § 215(a)(3).

31. Kasten, 131 U.S. at 1336.

32. Scalia chides the majority for treating the FLSA like it is part of a “living U.S. Code.” Id. at 1339.

33. Id. at 1341.

1.

There currently is a circuit-split on whether complaints to a private employer are protected.

Cf. Lambert v. Genesee Hosp., 10 F. 3d 46, 55 (2d Cir. 1993) (only complaints to the federal government are protected), with Hogan v.

Echostar Satellite, LLC, 529 F. ed 617, 625 (5th Cir. 2008).

35. However, this “presumably does not include a complaint to Judge Judy.” Id. (Scalia, J. dissenting).

36. 38 U.S.C. §§ 4301, et. seq.

37. Id. at n.1.

38. 131 U.S. 1186 (2011).

39. Id. at 1192.

40. Id. (internal citation omitted).

41. Id. at 1189.

42. Id. at 1194. The opinion does not decide whether cat’s paw liability can be based on a co-worker’s motive rather than a supervisor’s.

Regarding those who fall somewhere in between, if a person has sufficient authority or ability to take action against an employee, should it matter whether they are nominally labeled a “supervisor”? I think not, based on the references to agency law. Scalia refers to both “supervisors” and “agents.” The label given to the employee is less important than the authority he is given.

43. Id. at 1192 (internal citation omitted).

44. Id. 45. Id. at 1195.

46. See id. at 1192-93.

47. For a true appreciation of his talent, one must visit SCOTUS, the stellar blog for the high court, and read the Professor’s briefs. Find them at: http://www.scotusblog.com/case-files/cases/ staub-v-proctor-hospital/ (Staub); http://www. scotusblog.com/case-files/cases/thompson-vnorth-american-stainless/ (Thompson); http:// www.scotusblog.com/case-files/cases/kastenv-saint-gobain-performance-plastics-corp/ (Kasten).

48. “[I]t is the intent of Congress that the primary object of attention in cases brought under the ADA should be whether the entities covered under the ADA have complied with their obligations.” ADA Amendments Act of 2008, Pub. L. 110-325, Section 2(b)(5), Sept. 25, 2008 (incorporated into the ADA by 42 U.S.C. § 12102(4)(B)).

34. Id.

Drawings by Art Lien “I started sketching the U.S. Supreme Court thirty-five years ago, back when Rehnquist wore sideburns and John Paul Stevens was the junior Justice. It’s been a wonderful privilege that I enjoy more and more every year... and I’m finally getting pretty good at it.”

See more of Art’s work at www.courtartist.com Reproduced by permission

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62nd Harvest Party Raises Record $561,000 for Houston Bar Foundation

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he 62nd Harvest Party, co-sponsored by the Houston Bar Association, Houston Bar Association Auxiliary and Houston Bar Foundation, raised a record $561,000 in underwriting to benefit the Foundation, the charitable arm of the association. The event was held November 14 at River Oaks Country Club, with more than left, Michael Durham; Andi Durham, president of the Houston Bar Association 1,100 HBA members and their From Auxiliary; John Scofield; Denise Scofield, president of the Houston Bar Association; guests in attendance. HBA Trea- Becky Lowrey; and Bill Lowrey, 2011 chair of the Houston Bar Foundation surer David Chaumette and Houston Bar Foundation Chair Bill Lowrey served as event co-chairs.

The Houston Bar Foundation is now in its 29th year of service to the legal community and the profession. The Foundation’s primary beneficiary is the Houston Volunteer Lawyers Program, which provides thousands of hours of pro bono legal representation to low-income Harris County residents each year.

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John Eddie Williams and Sheridan Williams

David and Jaqueline Chaumette

Nikki and Benny Agosto

Wendy and Alistair Dawson

Yvonne and Rufus Cormier

Macey and Harry Reasoner

Sam and Melinda Stubbs

Gordon and Kay Dees

Elizabeth and Bill Kroger thehoustonlawyer.com

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COMMITTEE SPOTLIGHT

One Good IDEA Reaches Thousands of Students Across Houston

By Polly Graham

The Houston Lawyer

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enter the fifth grade at age 10, when a or nearly twenty years, doctors child is first considered a juvenile. and lawyers across Houston Students are encouraged to ask and have been teaming up twice a answer questions throughout the preyear through the Interprofessentations. To stimulate discussion, volsional Drug Education Alliance unteers often bring props such as hand(IDEA) Program to teach fifth grade stucuffs, jail attire, photographs, and organs dents about the medical and legal consequences of drug use. The program began in 1992 as a collaborative effort between the Houston Bar Association and the Harris County Medical Society, and has reached over 45,000 students since its inception.

During the nationwide Red Ribbon Week for drug abuse prevention this past October, 24 doctor-lawyer teams Attorney Rachael Rolon was joined by her husband, Dr. Sam Rolon, for an IDEA presentation in October. connected with over 1,500 school children across Houston. In interactive sessions, the teams talked to students about how drugs affect their minds, bodies, and futures.

Each lawyer is trained to give students practical information about Texas criminal laws. For example, many students learn that juveniles are subject to a special system of Fifth graders gather around Dr. Bruce Edison’s display of justice in which they can be organs damaged by alcohol. damaged by drug and alcohol abuse. By handcuffed, arrested, and kept in a depraising student participation, the teams tention facility. This basic information create a supportive environment where resonates with an audience of older elstudents can feel good about contributementary school children who typically

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ing to a productive dialogue, and volunteers can gently illicit and correct misconceptions.

Houston attorney Debbie Ziegler, a 2011-2012 co-chair of the IDEA committee, has been volunteering her time to make the program a success for over four years. She describes the program as extremely rewarding, noting that both the student participants and their teachers were very appreciative of volunteers’ time and effort. One of Ziegler’s favorite teaching tools is to bring a football to throw with the fifth graders. After passing the ball around, she then asks the students to put on a pair of “beer goggles.” With their vision distorted, the students find they can no longer catch a ball or write legibly. The students laugh and have fun, while taking home a memorable lesson on the serious consequences of alcohol use. Perhaps in the years to come some of these students will remember Ziegler’s goggles when pressured to use drugs or alcohol.

The spring IDEA program is set for May 8. Those interested in volunteering for the program should contact Debbie Ziegler at debbie@chaffinlawfirm.net or co-chair Carlos Garcia at crgarciaatlaw@peoplepc. com.

Polly Graham is an associate in the appellate practice section at Haynes and Boone LLP and a member of The Houston Lawyer Editorial Board.

A Profile in professionalism

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Benny Agosto, Jr. Partner, Abraham, Watkins, Nichols, Sorrels, Agosto & Friend National President, Hispanic National Bar Association

ho we are as professionals stems from the lessons we learned from our upbringing, from our parents, and from the traits and characteristics that form us as individuals. As for me, I live by a life motto that I learned from my parents—“Whatever you do, whether word or deed, do it all to the glory of God.” There are some deep lessons to be learned from that simple but powerful motto.

In our profession, whatever we do, whether by word or deed, it should be done to honor our clients.

If we follow this motto, we will certainly find that our conduct will always be beyond reproach and with the utmost cannons of ethics.

I like to say that my work has always been done one way—the right way. My foundation in professionalism has been built on certain core principles such as hard work, preparation, diligence, ethics, and a complete tenacity for all my clients. I must never be afraid to hold a responsible party accountable for his or her actions.

I believe a truly successful lawyer is one that leads by example—one who always demonstrates the highest standard of ethics and integrity, a true professional. A true professional should always aspire to have a consciousness of an honest purpose in life, a just estimate of oneself and everyone else, and a steady obedience to what one knows to be right. That is exactly who we all should aspire to be.

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OFF THE RECORD

Thomas A. Hagemann:

The Playwright’s Solution

By Julie Barry

and Abby. John, a successful trial attorney, has spent countless emotional hours planning every detail of a surprise party in honor of his wife’s return to the stage and their tenth wedding he effort to find balance in one’s life and relationships anniversary. He has packed the audience with 30 of their closis a universal struggle, one which Tom Hagemann so est friends, he has planned the party, and he has written her a poignantly addresses in his play, Breakfast at Eight, and heart-felt poem. As the play opens, John and Abby are arriving one which he seems to have conquered for himself. home from the party. Abby is on cloud nine, elated from the By day, Tom earns his living as the head of Gardere’s events of the night. She seems to white collar criminal defense group have it all. She is a wife and mother in Houston and in Dallas. With who still has found time to pursue more than 25 years of trial expeher acting career. But when Abby rience, make no mistake about it, presents John with her anniversary Tom truly enjoys being an attorgift to him, a pair of cufflinks, it ney and practicing law. But he has opens up a cavern of hurt, resentother passions. He is devoted to his ment and fear that has been buildactress wife, Christianne Mays, and ing in John. their two teenage kids. He also enBreakfast at Eight is a play filled joys being an amateur actor, somewith raw emotion to which every thing in which he has dallied since couple in a relationship can relate. grade school. But Tom has taken For Tom, the play developed during his other passion, writing, to a level a thee-week visit to his local Starhigher than mere dabble. With the bucks, shortly after the death of his self-discipline of a legal mind, Tom mother. His loss stirred emotions sets aside specific hours of the week that not only affected his personal to devote to his writing, and the life but his writing. Needless to say, fruits of this labor of love have reTom found writing the play to be a sulted in the successful production very cathartic experience. But aside of his first play, Breakfast at Eight, from the psychological therapy he

by Main Street Theater last year. garnered from writing Breakfast at After graduating magna cum Eight, Tom truly loves the writing laude from Rice University and experience. He has been able to crethen obtaining his J.D. from Yale, ate a successful work by synthesizTom spent six months in Atlanta Playwright Tom Hagemann and his wife, actress Christianne Mays ing his own personal experiences focusing solely on his writing in an with his knowledge of acting and the social and psychological attempt to create “the great American novel.” But he discovered dynamics that come from years of courtroom experience. Tom he did not have the patience or the personality to spend endless Hagemann is that rare being who seems to have discovered the hours secluded with his thoughts and words. So he turned to secret to maintaining balance in his work, his family, and his a profession more suited to his gregarious side – the practice of hobby. law. While pursuing a successful legal career, Tom has nevertheless been able to nurture his love of writing.

Julie Barry, attorney at law, focuses on U.S. and international Breakfast at Eight is the first of a trilogy that Tom has been commercial transactional matters. She is an associate editor developing. With its many autobiographical features, Breakfast for The Houston Lawyer. at Eight portrays one climactic night in the marriage of John

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Media Reviews

Documentary: Hot Coffee Produced and Directed by Susan Saladoff

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Reviewed by Angela L. Dixon usan Saladoff, an attorney who has practiced law for over 25 years, produced and directed Hot Coffee, a documentary film that examines tort reform and its effect on access to our civil justice system. The film opens with humor, including some Seinfeld clips that draw the viewer in. The film is divided into four exhibits, following four people whose lives have been profoundly affected by their inability to access the courts.

It also examines the roles of corporations and the media in tort reform.

The first exhibit focuses on the 1994 McDonalds case in which a 79 year-old woman, Stella Liebeck, sued McDonalds because she was burned by the cup of coffee she purchased from the drive-thru at a McDonalds in Albuquerque, New Mexico. Liebeck suffered severe third-degree burns as a result of the incident, and the film includes very graphic pictures of her injuries. In the film, Liebeck’s relatives, and the jurors and attorneys involved in the case, weigh in on the legal battle that ensued and the outcome of the case.

In the second exhibit, the film focuses on Colin Gourley, a teenager who was born with cerebral palsy because of medical malpractice. Colin has a twin brother who was born with no birth defects. The film discusses the $5.65 million dollars the jury awarded to cover Colin’s care, only to learn that because of a Nebraska state-mandated cap on damages, he would

only receive $1.25 million. The film also touched on caps in other states like that of Texas, which is $250,000. Colin requires care for life, and in the documentary his parents discuss how the cap has affected their lives, expressing their concern over what will happen to their beloved son when they are gone.

In the third exhibit, the focus is on Justice Oliver Diaz and his bid to serve on the Mississippi Supreme Court. Justice Diaz’s life was fictionalized in the John Grisham book, The Appeal, and Grisham makes an appearance in the documentary. Since Justice Diaz was not probusiness, there were many special interest groups who did not want him on the bench. While negative ads flooded the campaign, it did not affect Justice Diaz’s bid for the seat. Unfortunately for Diaz, those interest groups were able to have him criminally prosecuted which made it impossible for him to remain in office.

The documentary includes a first-hand account of Justice Diaz’s story.

Finally, in the fourth exhibit, Jaime Leigh Jones, a Houston woman who worked for KBR/Halliburton, is the focus.

Jones claimed to have been raped by a coworker while working for KBR/Halliburton in Iraq. In this case, the documentary examines the effects of mandatory arbitration contracts. Jones wanted to hold KBR/ Halliburton responsible for the incident but because her employment contract included an arbitration clause, she was told she did not have a right to a jury trial in a court of law. The documentary follows her fight to have her day in court. It also profiles a bill introduced by Senator Al Franken, prohibiting mandatory arbitration clauses for sexual assault in government contracts.

While this is a sensitive subject, Saladoff does a good job of balancing both

sides of the issue in regards to how the civil justice system works. The documentary has ample firsthand accounts to give the viewer a sense of what really took place in the lives of these four people, and why it is so important to be aware of what is going on in the justice system.

In her legal practice, Saladoff represented victims of individual and corporate negligence. Saladoff stopped practicing law in 2009 and dedicated her time to this documentary, her first feature-length film.

To learn more about the movie, visit www. hotcoffeethemovie.com.

Angela L. Dixon, , Attorney at Law, practices in the areas of wills and probate, personal injury law and business matters.

She is an associate editor for The Houston Lawyer.

Movie: Puncture Directed by Adam Kassen and Mark Kassen Starring Chris Evans and Mark Kassen

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Reviewed by Sammy Ford IV hat if a product existed that cost as much as similar but less safe products and could slow the spread of one of the most dangerous epidemics in history? But what if that product was not used because large health organizations actively blocked its use and used their collective power to paint the product’s inventor as a crackpot? Puncture, a film written by Houston attorney Paul Danziger and based and filmed in Houston, demonstrates the sad fact that such a product did exist and but for the work of primarily one troubled lawyer, it likely would never have seen the light of day.

In the wake of the AIDS epidemic, many health care professionals began contracting HIV from being accidentally stuck by

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Media Reviews

steady route of advertising and handling car wrecks. In one memorable scene, he demonstrates an over-the-top cheesy television commercial to Weiss, who can’t help but express his disgust. Weiss, brilliant, tattooed, with a penchant for prostitutes and drugs, wanted more. More than money, emotion was what fed his enthusiasm for cases. Early in the movie, after figuring out the hook for his upcoming trial and developing a passionate interest in the justice of the case, we see him giving a heart-felt closing to a few of his friends, taking cocaine bumps throughout.

As Weiss spent more time with Dancort’s case, what he learned shocked him.

Dancort’s safety needles weren’t being purchased because group purchasing organizations, from which hospitals obtained supplies, would only support vendors and manufacturers who could afford to pay to play. Even more galling, the hospital administrators knew about this. As one told Weiss, “I don’t want you to show this product to my nurses, because they’ll want it. And they can’t have it.” A lawsuit was the only answer. But as much as the issue would have to proceed through the courts, Weiss and Danziger would pursue other avenues. They arranged a meeting with a sympathetic senator who, after noticing cocaine powder on Weiss’ nose, asked him

The Houston Lawyer

used needles. After an emergency room nurse named Vicky Rogers, portrayed by Vanessa Shaw, contracted HIV and Hepatitis C, a family friend with engineering and manufacturing know-how decided that no one else should experience what Rogers did. That friend, Jeffrey Dancort, developed a spring-loaded, single-use syringe, which made it impossible for a needle to be reused. Dancort thought that hospitals would fall over themselves to purchase his needle, which cost as much as the needles then in use, but had the added benefit of protecting their employees from lifethreatening diseases. Nothing could be further from the truth. Despite the obvious safety benefits, Dancort found that he was unable to get any hospitals to purchase his needles.

In 1997, Rogers approached young Houston personal injury attorney Mike Weiss, played by Captain America’s Chris Evans, and his partner Paul Danziger, played by Mark Kassen, to investigate why these hospitals would not purchase a product that would protect their own employees. Neither wanted the case.

Danziger was the more pragmatic and straight-laced of the two. A large antitrust case would be far too expensive and would divert resources from the still struggling firm. To keep the lights on, he pursued the

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to drop the suit and let someone else represent Dancort. And while the senator ultimately gave him a second chance at that meeting, Weiss and Danziger realized just how big a fight they had on their hands when she stopped returning their calls after receiving a large donation from the group health organization.

The lawsuit almost bankrupts them, and while Weiss’ resolve is never undermined, Danziger sometimes has doubts.

Ultimately, with the help of attorney Mark Lanier, who plays himself in the movie, the group health organizations are forced to pay more than $100 million.

This was not an unalloyed victory. Dancort was still vilified; Vicky Rogers still succumbed to AIDS; Weiss’ demons catch up with him; and safety needles are to this day still optional. But despite its incomplete victory, the story of that fight, and the opportunity to see many familiar sights around Houston, is well worth the price of admission or rental.

Puncture received national distribution in the fall of 2011 and was released on DVD and Blu-Ray on January 3, 2012.

Sammy Ford IV is an associate at Abraham, Watkins, Nichols, Sorrels, Agosto & Friend and is a member of The Houston Lawyer Editorial Board.

PLACEMENT POLICY

PLACEMENT DEADLINES Jan. 1 Jan./Feb. Issue Mar. 1 March/April Issue

May July Sept.

Nov.

1 1 1 1

May/June Issue July/August Issue Sept./Oct. Issue Nov./Dec. Issue

If you need information about the Lawyer Placement Service, please contact HBA, placement coordinator, at the HBA office, 713-759-1133.

Positions Available

5076 Boutique Civil Litigation law firm specializing in complex business litigation is looking for an associate attorney with 1-3 years litigation experience and excellent research and writing skills.

5080 Houston public pension fund seeking Associate Counsel reporting to CLO. Approx. 4 yrs. experience with pensions, employment, administrative, institutional investing or local government law. Competitive benefit package. Background checks required.

5084 Full time associate position available. 5+ years experience required. Must have commercial and personal injury background. Competitive compensation package.

tization process of commercial loans and the duties and responsibilities of Mortgage Loan Originators/Depositors, Underwriters of REMIC Trusts, Rating Agencies, Trustees, Servicers and Special Servicers.

5094 ESTATE PLANNING Looking for in-house position.

– PROBATE ATTORNEY. SUGAR LAND. Board certiIf you need fied attorney, 33 year Houston information area practice serving Harris/ about the Fort Bend counties, seeking associate attorney with adLawyer Placement vanced estate planning and Service, please probate experience.

Positions Wanted

2062 Very Experienced Trial Attorney intimately familiar with the mechanics and operation of the Commercial Mortgage Backed Securities (CMBS) industry, including the securi-

contact HBA, placement coordinator, at the HBA office:

713-759-1133

Gotham Pizza Phone: 713.659.2222

Fax orders to: 713.659.5115 2204 Lousiana, Suite E Houston, TX 77002

Dine-In • Carry-Out • Delivery Open Late • Catering • Meetings Attorney-owned and HBA Member.

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placement service

The Houston Bar Association Lawyer Placement Service will assist members by coordinating placement between attorneys and law firms. The service is available to HBA members and provides a convenient process for locating or filling positions.

1. In order to place an ad, attorneys and law firms must complete a registration record. Once registration is complete, your position wanted or available will be registered with the placement service for six months. If at the end of the sixmonth period you have not found or filled your position, it will be your responsibility to re-register with the service in writing.

2. If you are registered, resumes will be sent out under their assigned code numbers. Once a firm has reviewed the resumes, they are to contact the placement office with the numbers they are interested in pursuing. The placement coordinator will then contact the attorney, give him/her some background information on the inquiring firm, and the attorney will then let the coordinator know if he/she wishes personal information to be released to the firm. This process will insure maximum confidentiality and get the information to the firms and attorneys in the most expedient manner.

3. In order to promote the efficiency of the Houston Lawyer Placement Service. PLEASE NOTIFY THE PLACEMENT COORDINATOR OF ANY POSITION FOUND OR FILLED. 4. To reply for a position available, send a letter to HBA, placement coordinator at the Houston Bar Association, 1300 First City Tower, 1001 Fannin Street, Houston, Texas 77002 or e-mail Brooke Eshleman at BrookeE@hba.org.

Include the code number and a resume for each position. The resume will be forwarded to the firm or company. Your resume will not be sent to your previous or current employers.

LITIGATION MARKETPLACE

Document Examiner

Office Space

Office Space at 3 Riverway Class “A” Building located off Woodway Drive and 610 West Loop.

Law firm is primary tenant.

Several offices available. Onsite management and security guard, attached parking garage for tenants and visitors, conference rooms, receptionist services, kitchen, wired for broadband internet access. Contact Lisa DeWild, 713-209-2934

chine, and up to three lines and voice mail on existing phone system. 12 to 28 foot ceilings. Non-smokers only.

Call MaeLissa Lipman at 713-840-9600 Houston/Galleria Area Law Offices, San Felipe at Sage, 19th floor. Office-sharing arrangement with well-established lawyers. Large executive office with great view and secretarial space. Immediate move-in. Includes receptionist, telephone service (including long distance), T-1 internet, fax, copier, postage machine, parking. Suite built new in 2007 with reception area, three conference rooms, law library, two kitchens. Call Don 713-260-3926.

HOUSTON / MUSEUM DISTRICT Newly remodeled Historic Home, minutes from the Court House. On-site Management, receptionist, three conference rooms, kitchen, small library, telephone system, internet access, copier, fax and free parking. Several offices available.

Quiet, professional small Call 713-840-1840 law office has two 11x12 furnished window offices, Executive Office file cabinets, copier, phones, Space Available: Starting at $700 per month. wifi, storage, conference Amenities include: 2 confer- room, reception, receptionence rooms; maid and re- ist. Perfect for small or part ception services; full kitch- time office practice. Upper en. Heights Boulevard address. Kirby, near Hwy. 59. Call Bill, 713-598-2400 Broker/owner. 713-880-4700

Legal Document Retrieval & Research www.legaldocusa.com legaldocusa@aol.com CV, CR, BK documents All Courts & Archives, UCC, Patent, Trademark Asset & Property Search Document Scanning Complete Service of Process The Houston Lawyer

1.800.487.2245 For classifieds contact:

Mary Chavoustie

mary@quantumsur.com

281.955.2449 ext.13 48

January/February 2012

Houston/Downtown Office Space Downtown offices just blocks from the courthouses - available for lease. Two office spaces are available on the top floor with balcony access.

Adjoining space for secretary/ assistant. Possibly furnished.

Call Angelina 713-201-5550.

Former art gallery on Colquitt Street (near Richmond and Kirby) converted to law offices has two furnished offices (one partner size) and three furnished secretarial stations available. Numerous amenities, including conference rooms, full kitchen, use of copier and postage mathehoustonlawyer.com

Position Available

Visiting Assistant Professor UH Energy Law Scholar The University of Houston Law Center invites applications for an energy law scholar for the academic year of 2012-2013. This is a full-time, nontenure-track position designed to help prepare highly qualified candidates for a career as a law professor by offering the opportunity to gain teaching experience and to devote substantial time to scholarly research and writing.

For additional details http://www.uh.edu/provost/fac/ faculty-openings/law46/index.php Submit any pre-application questions by email to: Professor Greg R. Vetter, www.law.uh.edu/faculty/gvetter or gvetter@uh.edu Equal Opportunity / Affirmative Action: UH is an Equal Opportunity/Affirmative Action employer. Minorities, women, veterans, and persons with disabilities are encouraged to apply.

Position Wanted Full-Charge Bookkeeper/ Administrator available part-time; Houston. Over 15 years law firm experience. Services: all functions related to general ledger, accounts receivable, accounts payable, payroll, client billing, tax report filings, budgeting, financial reporting, employee benefits.

Excellent References.

Barbara Morrison; 713-669-9377 morrisonhouston@sbcglobal.net

Sublease one/two window offices in 1225 N. Loop West building w/3 attorneys. Possible sec’y space available. Free parking, Ediscovery Expert. Expericonference room, and Internet. enced former John O’Quinn Call Heather at 713-900-2340 Attorney. Cases are won at the discovery phase. I handle Houston/Bellaire. Sublease one/ all aspects of Ediscovery. Ian two window offices in 6300 Davidson, Esq. 713-256-5250.

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Bookkeeping services for law firms. Experienced (20 year) small law practice bookkeeping by former banking personnel manager with business degree. We keep books for all your accounts, handle payroll, track employee wages and payroll taxes, and pay bills as required. Turn this important but time-consuming activity over to us so you can practice law. Contact Cathy at cathy.sharp62@gmail.com.

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Three great mortgage products for attorneys.

Special Financing for Attorneys Our special financing program is designed exclusively to meet the needs of attorneys for purchase of their primary residence.

• Mortgage loan with low down payment – up to $1,000,000.

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• Refinances with high loan-to-value also available.

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Financing for Construction/Permanent & Renovation/Permanent Loans As a professional, you’ve worked hard building your career. When building a home or completing a major home renovation, BBVA Compass works hard for you.

• Finance nearly the entire project, up to $1,000,000. For construction loans, you may finance the building contract, lot, and closing costs. For renovation loans, you may finance the renovation cost, purchase of a new home or payoff of existing home, and closing costs.

• Expanded loan-to-value ratios for loan amounts up to $1,750,000.

• Private mortgage insurance is not required.

• One application, one approval, and one closing for both the construction/renovation and the permanent loans – saves time and money.

• One-time float down available at time of conversion.

• Minimum loan amount of $100,000 for renovation financing.

Our mortgage professionals will go out of their way to meet the demands of your busyschedule and make buying, building, or renovating your home effortless.

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BBVA Compass is a trade name of Compass Bank, Member FDIC.

thehoustonlawyer.com

January/February 2012

49

The Houston Lawyer

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